Subway comes up with debt plan for sale

Right ingredients: Staff work at a Subway outlet in Manhattan, New York City. Second round bids for the firm topped 10 private equity firms, which will be whittled down to the final bidders. — Reuters

NEW YORK: The bankers running the sale process for Subway have given the private equity firms vying for the sandwich chain a US$5bil (RM22.3bil) acquisition financing plan, hoping to overcome a challenging environment for leveraged buyouts and fetch the company’s asking price of more than US$10bil (RM44.6bil), people familiar with the matter say.

Interest rates have been rising, and concerns about an economic slowdown have increased since Subway said in February it was exploring a sale, making debt more expensive and less available for buyout firms pursuing deals. This is weighing on how much private equity firms are offering to buy companies.