Bob Evans Farms, Inc. (NASDAQ:BOBE) (“Company”) today announced it entered into purchase and sale agreements with National Retail Properties, LP, an affiliate of National Retail Properties, Inc. (“NNN”) and Mesirow Realty Sale-Leaseback, Inc., (“Mesirow”), providing for:
- the sale for a purchase price of $163.4 million by Bob Evans Restaurants to NNN of a portfolio of 119 Bob Evans Restaurant properties, and
- the sale for a purchase price of $36.6 million by Bob Evans Restaurants to Mesirow of a portfolio of 26 Bob Evans Restaurant properties.
Each of NNN’s and Mesirow’s obligations to consummate the transactions is subject to completion of due diligence and certain customary closing conditions.
As part of the transactions, Bob Evans Restaurants has agreed to enter into absolute net master leases with NNN and with Mesirow pursuant to which Bob Evans Restaurants will lease the locations for an initial term of 20 years, with five renewal options of five years each. The Company and BEF Foods, Inc. have agreed to provide payment and performance guaranties to NNN and Mesirow.
Chief Administrative and Chief Financial Officer Mark Hood said, “The sale-leaseback transactions are expected to provide the Company with net proceeds (after tax- and transaction-related costs) of approximately $165 to $170 million, which we expect to use to pay down debt under the Company’s credit agreement, repurchase Company shares, and for other corporate purposes, while maintaining prudent leverage. The transactions are expected to close before the end of the Company’s fiscal year-end on April 29, 2016.”