Pizza Express bridge loan takeout

TDR Capital and Capricorn Ventures have reworked the capital structure of Pizza Express’ £440m LBO package to reduce interest costs at the company.

The £310m senior debt facility and £130m high-yield bridge were put in place last April to support the takeover of Ask Central. HSBC, Lehman Brothers and RBS arranged the deal, which was also for refinancing purposes.

The company has performed better than expected, allowing it to repay the subordinated debt from cash and with more cheaply priced loan facilities. The bridge has been paid down by £40m in cash and replaced with a £40m second lien loan that pays 700bp over Libor and a £50m add-on term loan D at 375bp over Libor.

The new loans have been placed with existing investors and some new ones.

Existing senior debt facilities comprise a £140m seven-year term loan A paying 225bp over Libor, a £75m eight-year term loan B at 275bp, a £75m nine-year term loan C at 325bp and a £20m seven-year revolver at 225bp.

Conditions in the leveraged loan market remain extremely favourable for buyout facilities. Institutional investors say there are upwards of 20 LBO deals on the calendar.