Daily News: March 18, 2015

Capitala Successfully Exits KBP Investments

Capitala Finance recently exited its investment in KBP Investments, a holding company for one of the largest quick-service restaurant franchisee systems in the United States.

Earlier this month Capitala sold its preferred and common equity investment in KBP in exchange for total upfront cash proceeds of $17.6 million. Capitala will recognize a $9.3 million realized gain in the first quarter of 2015 in respect of this transaction. Since Capitala’s investment in April 2011, the implied internal rate of return on its KBP investment is 40% with a cumulative cash-on-cash return of 2.92x.

“We are delighted to have been a financing partner for KBP,” stated Joe Alala, chairman and CEO of Capitala. “The successful exit of our largest equity investment is a great milestone for Capitala. We will continue to execute on our investment strategy of rotating a portion of our portfolio from successful equity investments to current-yielding investments and seek new opportunities to put the Company’s capital to work.”

Overland Park, Kansas-based KBP Investments is a holding company for KBP Foods, a franchisee of more than 270 KFC and Taco Bell restaurants in 10 states throughout the Midwest and Southeastern United States.