El Pollo Loco Holdings announced that it successfully closed on a new five-year, $200 million senior secured credit facility. The new facility replaces the company’s existing $205 million senior credit facility, which had an outstanding term loan balance of $188.6 million.

Bank of America served as administrative agent for the transaction. Wells Fargo Bank served as syndication agent. Merrill Lynch and Wells Fargo Securities served as joint lead arrangers and joint bookrunners for the transaction.

In conjunction with the closing of the transaction, the company used approximately $26.5 million of cash on hand to further reduce its outstanding debt and to pay fees, expenses and accrued interest associated with the refinancing. Upon the completion of the refinancing, the company will have approximately $165 million of total debt outstanding.

Based on current market conditions, the refinancing represents a 250-300 basis point reduction in the company’s borrowing costs and, when combined with the debt reduction, is expected to reduce annual interest expense by approximately $7 million per year.

Steve Sather, president and chief executive officer of El Pollo Loco said, “We’re pleased to have closed on our new credit facility which represents another step to strengthen our capital structure. This refinancing significantly reduces our interest expense and provides additional flexibility to execute our development strategy.”

El Pollo Loco is a growing restaurant concept that specializes in fire-grilling citrus-marinated chicken in front of its customers.