Hoping to duplicate its successful transformation into a major franchise brand, IHOP Corp. is using familiar securitization techniques to finance its $2.1 billion buyout and subsequent revamping of Applebee's International.

IHOP announced its intention to merge with Applebee's last Monday and said it would finance the all-cash transaction through a whole-business securitization backed by Applebee's assets. IHOP also plans to raise another $175 million under its securitization structure to contribute capital to the deal, said Tom Conforte, IHOP's CFO. Lehman Brothers will act as sole structuring adviser and sole underwriter for both transactions.

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