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Portillo’s completes successful debt refinancing transaction
The Fly

Portillo’s completes successful debt refinancing transaction

Portillo’s announced that it has successfully refinanced its existing credit facility with a new 5-year $300M Term A Loan, resulting in a significant reduction in interest expense. At prevailing rates, the all-in interest rate on the term debt has been reduced by approximately 270 basis points. The refinancing provides Portillo’s with greater financial flexibility in support of the Company’s ongoing expansion. The new Term A Loan has an interest rate based on the Secured Overnight Financing Rate, SOFR, plus a credit spread adjustment of 10 to 15 basis points depending on the commitment term, plus a margin of 275 basis points. The new rate compares favorably to the existing credit facility’s margin, which was based on the London Interbank Offered Rate, LIBOR, plus 550 basis points. The Company also entered into a new 5-year Revolving Credit Facility, increasing its short-term borrowing capacity from $50 million to $100 million. At closing, the Company borrowed $15 million under the Revolving Credit Facility and has over $80 million of remaining borrowing capacity, net of letters of credit of approximately $4.4 million. "Since our IPO in 2021, we’ve prudently managed our capital structure by reducing leverage and securing more favorable terms on our debt obligations," said Michelle Hook, Portillo’s Chief Financial Officer. "Completing a successful refinancing in the current environment reflects well on the strength of our brand and the stability of our business and provides us with additional financial flexibility to execute our growth strategy and operational enhancement initiatives."

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