It looks as if the Boys are busting out Dunkin Donuts

[Slimprofits]

http://www.boston.com/news/local/mas...files_for_ipo/

Dunkin' Brands is currently owned by private-equity firms, who bought it in 2005 from wine and spirits distributor Pernod Ricard. The owners, Bain Capital Partners, Carlyle Group and Thomas H. Lee Partners, do not plan to sell their shares, the company said.

Dunkin' Brands Group Inc. , the parent company of Dunkin' Donuts and Baskin-Robbins, on Wednesday filed regulatory papers saying it plans to raise as much as $400 million by selling shares to the public, using most of the money to pay off debt.

The company didn't say when the offering might be, or how many shares it would offer.

The company said it would use its proceeds from the stock offering to pay down about $475 million in high-interest debt owed to banks. That money was borrowed partly to pay a $500 million dividend to some of the company's current shareholders.

That's a four paragraph excerpt. I switched the order of the first two paragraphs.

[c1ue]

Re: It looks as if the Boys are busting out Dunkin Donuts

Nothing to see here. Classic LBO followed by pillaging.

[mmr]

Re: It looks as if the Boys are busting out Dunkin Donuts

They've been pillaging this one for quite some time - they levered that thing at 8.5 debt / EBITDA (just about the highest leverage for any private equity deal at the very peak of the cycle in 2006) by securitizing the revenues from the entire business (literally, borrowing $1.6 billion just against the value of the Dunkin' Donuts brand name.)

Ah, the good old days, when you could borrow against anything, or nothing at all...

[don]

Re: It looks as if the Boys are busting out Dunkin Donuts

Are the donuts and ice cream pretty much 100% franchised?

[mmr]

Re: It looks as if the Boys are busting out Dunkin Donuts

Yes - it looks like all but about 20 stores out of 10,000 are franchises.

[Shakespear]

Re: It looks as if the Boys are busting out Dunkin Donuts

People going to Dunkin Donuts are ready for this franchise.

http://www.examiner.com/fitness-in-b...itness-routine

Not sure what is out there but the franchise concept would sell itself IMHO.

"Lose the weight or lose your life saving through medical problems."

[don]

Re: It looks as if the Boys are busting out Dunkin Donuts

Yes - it looks like all but about 20 stores out of 10,000 are franchises.

Would I be amiss in thinking they are taking it in the shorts with the sacking of corporate?

[seanm123]

Re: It looks as if the Boys are busting out Dunkin Donuts

Dunkin Franchise expansion was finance heavily by CIT GROUP a 2.3 Billion TARP recipient.
I wonder how that loan portfolio is faring, I don't have the numbers but there were quite a few
bankruptcies filed by the franchisees.

[don]

Re: It looks as if the Boys are busting out Dunkin Donuts

Dunkin Franchise expansion was finance heavily by CIT GROUP a 2.3 Billion TARP recipient.
I wonder how that loan portfolio is faring, I don't have the numbers but there were quite a few
bankruptcies filed by the franchisees.

Tell me an 18-hour workday/ 7 days a week franchise holder got some of that loot.

Please.

[Slimprofits]

Re: It looks as if the Boys are busting out Dunkin Donuts

And then finally, when there's nothing left, when you can't borrow another buck from the bank or buy another case of booze, you bust the joint out. You light a match.

[Slimprofits]

Re: It looks as if the Boys are busting out Dunkin Donuts

Dunkin Franchise expansion was finance heavily by CIT GROUP a 2.3 Billion TARP recipient.
I wonder how that loan portfolio is faring, I don't have the numbers but there were quite a few
bankruptcies filed by the franchisees.

Gee, I wonder if the banks that lent them the money at high interest rates in order to pay dividends to the LBO boys were TARP recipients too?

[don]

Re: It looks as if the Boys are busting out Dunkin Donuts

And then finally, when there's nothing left, when you can't borrow another buck from the bank or buy another case of booze, you bust the joint out. You light a match.

from the Sopranos?

Bust Outs - an organized crime staple for decades.

[seanm123]

Re: It looks as if the Boys are busting out Dunkin Donuts

No CIT was 29 Billion in the hole before the bank holding company status was approved and the TARP loan
of 2.3 billion was made. It only staved off bankruptcy for another year. The taxpayers lost all of their investment.
The franchise holders well some went under, it seems that coffee even at $2 a cup is only for closers.

[Munger]

Re: It looks as if the Boys are busting out Dunkin Donuts

Goodfellas.

[Slimprofits]

Re: It looks as if the Boys are busting out Dunkin Donuts

No CIT was 29 Billion in the hole before the bank holding company status was approved and the TARP loan
of 2.3 billion was made. It only staved off bankruptcy for another year. The taxpayers lost all of their investment.
The franchise holders well some went under, it seems that coffee even at $2 a cup is only for closers.

I am wondering about the banks that lent money to Dunkin. The company said it would use its proceeds from the stock offering to pay down about $475 million in high-interest debt owed to banks.