The effort to take Papa John’s off public markets just got a whole lot more real. Irth Capital Management has lined up a financing package consisting of $725 million in preferred equity and $1 billion in bridge debt, giving the private equity firm nearly $2 billion in firepower for what would be one of the more notable restaurant take-private deals in recent memory.
The bid values Papa John’s at approximately $1.5 billion, or $47 per share. That represents a meaningful premium over where the stock had been trading, which helps explain why the deal keeps gaining momentum instead of fizzling out like so many unsolicited offers tend to do.
Who’s writing the checks
The $725 million in preferred equity comes with Brookfield Asset Management’s commitment, carrying a 12% all-in yield. Brookfield plans to syndicate portions of that preferred equity investment to additional private credit investors.
Morgan Stanley is handling the $1 billion bridge debt portion. The expectation is that this bridge financing will eventually transition into whole-business securitization, where the debt would get restructured so that Papa John’s franchise royalty streams and other predictable cash flows serve as collateral.
