Fast-food-chain operator Church's Chicken is paying 6% on its $220 million in bonds backed by franchise fees and store revenue, a person familiar with the matter said Friday.

The deal is one of the first whole business securitizations backed essentially by all of a company’s assets since the credit crisis. The offering is further evidence that investors, hungry for yield, are becoming increasingly comfortable with esoteric asset classes.

The senior secured notes, which are rated 'BBB' by Standard & Poor's and 'Baa2' by Moody’s Investors Service, have an anticipated repayment date in February 2018 and a legal final maturity date in February 2041. The deal settles on Feb. 25 and the first payment is scheduled for May 20.

The deal also includes $25 million of senior secured revolving notes, which were provisionally rated 'Baa2' by Moody's.

The notes are backed by essentially all of the tangible and intangible assets comprising the owned and franchised Church's Chicken and Texas Chicken business, both domestic and international.

Barclays Capital is the sole structuring advisor and bookrunning manager.

In December, Nu CO2 issued $75 million of notes backed by revenue from the leasing of bulk carbon dioxide systems and the distribution of carbon dioxide to retailers of fountain beverages.

And in November, Adams Outdoor Advertising raised $355 million through the sale of bonds backed by billboard revenue, although there’s some debate as to whether that deal qualified as a whole business securitization. That’s because the management of billboard assets is considered more transferable than the management of a franchise restaurant business. For this reason, Moody’s classified Adams Outdoor’s deal as an “operating asset” securitization, rather than a "whole business securitization."


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