CKE Restaurants plans new credit facility, notes for buyout by Apollo

By Sara Rosenberg

New York, April 26 - CKE Restaurants Inc. is planning a new credit facility and the issue of new notes to help fund its new buyout agreement with Apollo Global Management, according to a market source.

Morgan Stanley, Citigroup and RBC Capital Markets are the lead banks on the deal.

In total, the banks have provided a commitment for $700 million in financing for the transaction, a news release said.

Under the terms of the agreement, CKE stockholders will receive $12.55 in cash per share. The transaction is valued at about $1 billion, including the refinancing of the company's outstanding debt.

Completion of the transaction is expected to occur by the end of the second quarter of fiscal 2011, subject to customary conditions, including approval by holders of the majority of CKE's outstanding shares and the receipt of regulatory approvals.

The agreement with Apollo replaces the company's previously agreed upon buyout by Thomas H. Lee Partners for $11.05 in cash per share.

Under the Thomas H. Lee deal, the company was going to get a $450 million senior secured credit facility - comprised of a $75 million revolver and a $375 million term loan - and $150 million of senior unsecured notes, with Bank of America and Barclays leading the financing.

CKE Restaurants is a Carpinteria, Calif.-based owner of Carl's Jr. and Hardee's quick-service restaurant chains.

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