Yum Brands to Refinance $1B in Notes

By Tamara Parker • Wednesday, September 03 15:35 • Permanent Link

Yum! Brands, Inc. has announced its intention to refinance its Series 2016-1 Class A-2-III Notes, which were issued by a wholly-owned subsidiary of Taco Bell Corp. The company plans to refinance the notes with a new series of notes called the New Notes, which are expected to be comprised of $1.0 billion of senior term notes.

As of June 30, 2025, the balances of the Series 2016-1 Class A-2-III Notes, the Series 2018-1 Class A-2-II Notes, the Series 2021-1 Class A-2-I Notes, the Series 2021-1 Class A-2-II Notes, and the Series 2021-1 Class A-2-III Notes were approximately $938 million, $595 million, $884 million, $590 million, and $737 million, respectively.

The net proceeds from the New Notes will be used for the repayment of the Series 2016-1 Class A-2-III Notes, certain transaction-related expenses, and for general corporate purposes. It's important to note that the Series 2018-1 Class A-2-II Notes, the Series 2021-1 Class A-2-I Notes, the Series 2021-1 Class A-2-II Notes, and the Series 2021-1 Class A-2-III Notes will remain outstanding.

The press release also mentions that there can be no assurance regarding the timing of a refinancing transaction, the interest rate at which the Series 2016-1 Class A-2-III Notes would be refinanced, or that a refinancing transaction will be completed.

The New Notes will only be offered and sold to qualified institutional buyers in the United States in accordance with Rule 144A under the Securities Act of 1933, as amended, and to persons outside the United States in accordance with Regulation S under the Securities Act.

It's important to emphasize that the New Notes have not been, and will not be, registered under the Securities Act, any state or other jurisdiction’s securities laws, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state or other jurisdiction’s securities laws. The market has reacted to these announcements by moving the company's shares -0.47% to a price of $144.75. For more information, read the company's full 8-K submission here.

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