Wingstop (WING) Declares $3.17 Special Dividend; 6.6% Yield

Wingstop (NASDAQ: WING) declared a special dividend of $3.17 per share. The dividend will be payable on February 14, 2018, to stockholders of record on February 9, 2018, with an ex-dividend date of February 8, 2018. The annual yield on the dividend is 6.6 percent.

The special dividend is in conjunction with the Company closing on a new $250 million senior secured credit facility. The special cash dividend represents approximately 7% of Wingstop’s total market capitalization. The new senior secured credit facility replaces the existing June 2016 senior secured credit facility.

Wingstop’s new 5-year credit facility bears an initial interest rate of LIBOR + 275 bps and consists of a $100 million senior secured term loan with a 5% mandatory amortization and a $150 million senior secured revolving credit facility. The interest rate is subject to a grid with step downs of 25 basis points as leverage declines.

Following payment of the special dividend, Wingstop will have drawn approximately $230 million on the new credit facility, including the full amount of the term loan facility and $130 million of the revolving facility, to refinance $133.8 million of outstanding indebtedness under Wingstop’s June 2016 credit facility and pay the special dividend.

The special cash dividend will be paid on February 14, 2018 to stockholders of record as of February 9, 2018. Wingstop’s common stock will begin trading on an ex-dividend basis on February 8, 2018. Stockholders who sell their shares prior to the February 8, 2018 ex-dividend date will also be selling their right to receive the special dividend.

While the tax treatment of the special dividend cannot be concluded with certainty in 2019, the Company expects approximately 65% - 75% of the special dividend will be treated by stockholders as a return of capital, with the remaining 25% - 35% treated as a dividend. Stockholders are encouraged to consult with their financial and tax advisors regarding circumstances of their individual situation.

For a dividend history and other dividend-related data on Wingstop (WING) click here.

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