CASE STUDIES

Recapitalization

Partnership Recapitalization

Client Background

The owner of the largest franchisee in a leading fast casual brand desired a partial liquidity event by engaging an outside equity partner. The Company was a family-owned business with a strong culture that the owner did not want to upset.

Given ongoing family ownership and involvement, the focus was on finding a strategic financial partner with a deep understanding of the restaurant industry and capability to support the next phase of growth while not interfering in daily management and operations.

Our Solution

CapitalSpring delivered a one-stop mezzanine and equity solution that provided significant liquidity to the key shareholder while preserving meaningful post-close ownership in a ~50/50 partnership. Family members and management maintained autonomy to operate the business on their own.

  • Active strategic involvement on Board

  • Advised on credit agreement negotiations with third party lenders

  • Acted as sounding board on operational and new development issues

  • Identified real estate arbitrage opportunities in existing lease portfolio

Dividend Recapitalization

Client Background

The owner of a 60-unit QSR franchisee desired liquidity for estate planning purposes but was hesitant to seek a full exit of his business. The Company operated strong stores in a core brand territory with SSS growth outpacing the system.

There was also a desire to consolidate existing disparate credit groups and lender relationships across multiple entities to unlock additional debt capacity.

Our Solution

CapitalSpring provided a unitranche solution through 6.0x that consolidated operations under a single loan with a flexible structure to support future acquisition activity. The owner received a ~$30M special dividend and maintained 100% ownership in his business.

  • Acted as strategic partner to owner by assessing growth opportunities

  • Sourced acquisition opportunity in a contiguous territory and advised on divestiture of select units in non-core markets

  • Assisted in optimization of back-office functions through recommendation of in-sourced solutions

  • Ongoing financial backer and source of creative capital to fund growth