ORLANDO Fla. Darden Restaurants Inc.’s pending acquisition of Rare Hospitality International Inc. took another step toward its expected October closing as the casual-dining operator secured two new credit agreements totaling $1.9 billion to help finance the deal, Darden said Monday in filings with securities regulators.
Darden’s purchase of Rare Hospitality, the Atlanta-based owner and operator of the LongHorn Steakhouse and The Capital Grille concepts, was first announced in August and is valued at about $1.4 billion, including debt.
In Monday’s filings, Darden said it secured a $750 million revolving credit agreement and a $1.15 billion 364-day interim credit agreement. The revolving credit agreement can be used for working capital, capital expenditures, refinancing debt and partial financing of the Rare acquisition. The entire interim credit facility is earmarked for the purchase of Rare, Darden said.
That credit facility matures on Sept. 20, 2012, Darden added. Both loans are senior unsecured debt obligations.
Darden, which owns and operates about 1,400 restaurants under four brands including the flagships Red Lobster and Olive Garden, also said it had terminated the company’s previous $500 million credit agreement and repaid all the outstanding loans under that arrangement.
Bank of America NA acted as administrative agent for Darden’s latest credit agreements.