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Krispy Kreme sells major stake in Mexican franchise

May 9, 2011

Krispy Kreme Doughnuts Inc. has sold its 30 percent stake in Krispy Kreme Mexico S. de R.L. de C.V., one of its Mexican franchises, for $7.8 million.

According to Charlotte-Raleigh Citybizlist, Krispy Kreme received net proceeds of $5.9 million from the sale. The Winston-Salem, N.C.-based company paid an estimated $1.5 million in Mexican taxes and is expected to report an after-tax gain of $4.4 million in the quarter ending July 31.

Proceeds from the transaction will be used to make a $6.2 million payment toward an outstanding term loan, which would reduce Krispy Kreme's debt to $28.2 million.