Taco Bell Sale Leaseback Financing Business Acquisition

Background: 

The Ascension Team represents a quick service restaurant operator who was in the process of acquiring 14-unit Taco Bell portfolio in northern Louisiana. The Private Equity firm engaged Ascension to run an expedited sale leaseback marketing process in order to bring in offers from investors who could close simultaneous with the acquisition of the business. 

Client Objective: 

The client faced timing constrains due to the simultaneous nature of the sale leaseback transaction in conjunction to the business acquisition. The Private equity group was under APA to acquire 16 stores from an existing Taco Bell Franchisee where 14 properties were included in the acquisition. At the close of escrow, the private equity group entered into fourteen brand new individual 20-year, Absolute Triple-Net (NNN) leases with 1.50% annual rental escalations. Given the quick turnaround time for offers, the Ascension team built a targeted short-list of quick service restaurant sale leaseback private equity groups to approach, all cash buyers who could be flexible and close simultaneously with the business acquisition.

Solution:

The Ascension team ran an expedited marketing process and brought in six competitive offers within the first week of being engaged. The team successfully closed the 14-unit portfolio sale leaseback transaction in conjunction with the business acquisition at a total purchase price of $36.1 million. The sale leaseback proceeds were an important piece of the sponsor’s total capital stack for the acquisition of the quick service restaurant business.