Whole Business Securitization. After the market closed Tuesday, FAT Brands announced the completion of a $144.5 million offering of fixed rate asset-backed notes, structured as a whole business securitization. This is the Company's third successful securitization over the past twelve months, with the amount raised rising from the initial $40 million raise in March 2020.More Ammunition. The upsized deal provides FAT Brands with additional capital to continue its strategy of acquiring high growth potential restaurant concepts to its existing stable of nine restaurant brands. At the end of the fourth quarter, the Company had $80 million of existing Notes and a $5 million sellers note outstanding. If all of these were refinanced, that would leave some $60 million of capacity for other uses, which we expect a portion to be deployed sooner rather than later for acquisitions.And Lower Costs. The weighted average fixed interest rate falls to 5.92% from 7.75% in the original March 2020 Notes. The lower rate reflects the tremendous progress made by the Company, in a pandemic year, in strengthening its position in the marketplace, including the transformative Johnny Rockets transaction, in our view.Details. Three tranches with $97.1 million of Senior A-2 Notes at a 4.75% coupon, $32.4 million of Senior B-2 Notes with a 8.00% coupon, and $15 million of Subordinated M-2 Notes with a 9.00% coupon. Weighted average life of all classes is 2.25 years, with a six month non-call period and July 2023 anticipated call date.Maintaining Outperform and $12 Price Target. We are maintaining FAT Brands shares at Outperform and our $12.00 12-month price target. The new whole business securitization provides the Company with ample funds to acquire additional concepts while providing a lower weighted average interest rate. We continue to believe the Johnny Rockets acquisition to be transformative, providing the Company with significant size in terms of number of locations and systemwide sales, enhanced geographic diversification, a broadened franchisee base, and multiple avenues for additional growth. And we see more M&A to come. Read More >>