Fitch Ratings assigned a 'BBB-' rating to Arcos Dorados' benchmark size proposed senior unsecured notes on January 22, 2025. These notes are to be issued by its subsidiary Arcos Dorados B.V. and will be guaranteed on a senior unsecured basis by Arcos Dorados Holdings and certain subsidiaries.
The proceeds from this new issuance are intended to fund a tender offer for the company's outstanding 5.875% notes due 2027 and for general corporate purposes. This move is part of Arcos Dorados' strategy to improve its debt maturity profile and reduce refinancing risk.
The 'BBB-' rating is supported by the company's strong operating performance, improved leverage metrics, good liquidity, and a comfortable debt maturity profile. Fitch expects Arcos Dorados' EBITDA to average around $540 million for 2024-2026, with an EBITDA margin close to 11%.
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