Restaurant Brands raises $94 million for US deal

KFCRestaurant Brands NZ has successfully raised $94 million through a sale of shares to investors, helping fund its planned purchase of Pacific Island Restaurants, the largest fast-food operator in Hawaii with 82 Taco Bell and Pizza Hut stores.

The Auckland-based company raised $52m from institutions and $42m from retail investors through the offer of one new share at $4.70 apiece for every 5.15 shares already owned, it said.

The offer was fully subscribed, and no new shares were issued.

The clearing price under the retail bookbuild was $4.90 per new share, representing a premium of 20 cents over the application price, which means eligible retail shareholders who elected not to take up all or part of their entitlement and ineligible retail shareholders will receive 20 cents for each new share not taken up by them, the company said.

The company’s shares are set to resume trading on Monday after being placed in a trading halt on November 18. The shares last changed hands at $5.09 on November 17, and have gained 17 per cent this year. The new shares are expected to be issued on November 23, and start trading a day later.

Restaurant Brands, which runs the KFC, Pizza Hut, Starbucks Coffee and Carl’s Jr food chains in New Zealand, is expanding into new markets to spread its risk and drive future earnings growth.

In April, it bought the biggest KFC franchisee in New South Wales, Australia, and it expects to complete the $US105m ($NZ150m) purchase of Pacific Island Restaurants by late December, with the remaining funds coming from $US42m ($NZ60m) of debt.

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