By Lillian Rizzo
Wingstop Restaurants Inc., a chicken-wing chain owned by
private-equity firm Roark Capital Group, will seek to raise up to
$86.25 million in an initial public offering, according to a filing
with the Securities and Exchange Commission.
The Dallas company, which didn't specify how many shares it will
offer in the IPO, plans to use the proceeds to repay debt, pay a
fee for the termination of a management agreement with Roark
Capital, and for other general purposes. The company borrowed from
its senior secured credit facility and cash on hand to pay a $48
million dividend to shareholders on March 18, according to the
filing.
After the company goes public, Roark will own more than 50% of
total voting power of common stock.
The company has applied to be listed on Nasdaq under the stock
ticker symbol WING. Morgan Stanley & Co., Jefferies LLC and
Robert W. Baird & Co., are the lead underwriters of the
IPO.
Wingstop had $20.9 million in earnings before interest, taxes,
depreciation and amortization for the year ended Dec. 27, an
increase from about $17.9 million the previous year, according to
the filing. Total revenue increased 14.3% year-over-year to $67.4
million.
Founded in 1994, the chain has 712 restaurants, 97% of them
franchised, across 36 states and six countries, the filing said.
Wingstop's number of domestic restaurants has increased 37.5% since
the end of 2011, while domestic same-store sales grew through 11
straight quarters.
Atlanta-based Roark acquired Wingstop in 2010, in a deal valued
at between $80 million to $90 million, Dow Jones's LBO Wire
reported at the time, citing people familiar with the matter.
Around half of that deal was in the form of debt from Wells Fargo
& Co. and GE Capital, and involved mezzanine financing from
Arrowhead Mezzanine LLC and an equity rollover from management.
The Wall Street Journal reported in October that Wingstop was
planning an IPO, potentially valuing the company at roughly $500
million.
Write to Lillian Rizzo at Lillian.Rizzo@wsj.com
Access Investor Kit for Leucadia National Corp.
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US5272881047
Access Investor Kit for Morgan Stanley
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US6174464486
Subscribe to WSJ: http://online.wsj.com?mod=djnwires