The Second Cup Ltd (TSX: SCU) has obtained an $8 million secured term loan from SPE Finance LLC, an affiliate of Serruya Private Equity (SPE), which invests on behalf of Canada’s Serruya family. As a result of the deal, Second Cup agreed to nominate an SPE representative to its board of directors. The loan’s proceeds will be used to repay the company’s $6 million credit facility and for other purposes. Toronto-based Second Cup is a specialty coffee retailer operating over 295 franchised and directly-owned cafes. SPE Managing Director Michael Serruya said his firm will help build the “iconic Canadian brand.”
The Second Cup Ltd. Announces $8 Million Secured Term Loan with Affiliate of Serruya Private Equity
MISSISSAUGA, ON, Dec. 5, 2016 /CNW/ – The Second Cup Ltd. (TSX: SCU) announced today that it has entered into a 4 year, $8 million secured term loan with SPE Finance LLC, an affiliate of Serruya Private Equity (SPE). Proceeds from the term loan will be used to repay the Company’s existing $6 million credit facility and for general corporate purposes.
This term loan carries an interest rate of 10% and includes warrants to purchase up to 600,000 common shares at a strike price of $2.75 per share. In addition, the Company has agreed to nominate a nominee from SPE to sit on its board of directors
“We considered a number of alternatives along with the special committee and we are very pleased to have selected Serruya Private Equity,” said Ms. Barbara Mallon, Vice President of Finance and CFO. “This financing enhances our financial capacity to support the implementation of our strategic plan. The Serruya family has a tremendous track record in franchising and we look forward to benefiting from their expertise.”
“We are excited to be investing with Second Cup, an iconic Canadian brand” said Michael Serruya, Managing Director at SPE. “This investment capitalizes on our experience and we look forward to helping to build Second Cup in the future.”
The special committee has fulfilled its mandate and is no longer required. The Board of Directors will continue to pursue opportunities in the shareholders’ best interests.
About Second Cup Coffee Co.™
Founded in 1975, The Second Cup Ltd. is a Canadian specialty coffee retailer operating over 295 franchised and company owned cafes. The company’s vision is to be the coffee brand most passionately committed to quality and innovation. For more information, please visit www.secondcup.com or find the company on Facebook and Twitter.
About Serruya Private Equity
Serruya Private Equity Inc. (SPE) is a Toronto-area based, family managed group that invests capital in a broad range of asset classes, with an emphasis on retail and real estate. SPE’s principals have a heritage of experience developing brands and its affiliates currently include global brands Yogen Fruz, Pinkberry and Swensens, with over one billion dollars of worldwide system revenue.
For more information please contact email@example.com
For further information: Barbara Mallon, Chief Financial Officer, (905) 362-1824 or firstname.lastname@example.org.
Photo courtesy of The Second Cup Ltd