Sonic Corp. announced it has repurchased $62.5 million of its debt in a privately negotiated transaction. With this move, the company expects to gain approximately $5 million on the extinguishment of its Class A-1 variable funding senior notes.
Post-transaction, Sonic’s outstanding debt stands at approximately $520 million, and the company will have more than $30 million of unrestricted cash available for general corporate use. Additionally, Sonic expects to make principle payments of $58 million throughout the remainder of fiscal year 2011.
"We are pleased with the company's ability and efforts over the past two years to use excess cash effectively to reduce debt and strengthen our balance sheet," said Clifford Hudson, chairman and CEO, Sonic Corp. "These purchases, combined with regularly scheduled principal payments, bolster Sonic's capital structure and provide additional financing flexibility to manage our business."
Sonic will report its first quarter FY11 results Jan. 4.
