Lucky Strike Entertainment increases revolving credit facility by $50 million

Lucky Strike Entertainment Corp. (NYSE:LUCK) announced Wednesday that it has entered into a Fourteenth Amendment to its First Lien Credit Agreement, increasing its total revolving credit commitments by $50 million to a new aggregate of $385 million. The agreement was executed with JPMorgan Chase (NYSE:JPM) Bank, N.A. as administrative agent and includes Kingpin Intermediate Holdings LLC, a direct subsidiary, as borrower. The company, currently valued at $1.43 billion, operates with total debt of $3.04 billion and maintains an EBITDA of $292.55 million.

According to the company’s statement in a regulatory filing, the incremental revolving commitments carry the same terms as the existing facility, including interest rate and maturity date. The original credit agreement was dated July 3, 2017, and has been amended multiple times prior to this latest change. InvestingPro analysis indicates the company operates with a significant debt burden, with short-term obligations exceeding liquid assets as reflected in its current ratio of 0.64.

The filing also noted that the Fourteenth Amendment and the updated credit agreement were included as exhibits to the current report. No additional changes to the terms or covenants were disclosed.

This information is based on a statement made in a press release included in the company’s Form 8-K filing with the Securities and Exchange Commission.

In other recent news, Lucky Strike Entertainment has acquired the real estate underlying 58 of its venues for $306 million, converting the company from tenant to owner at these locations. This strategic move is expected to be immediately accretive to both earnings and cash flow. Stifel reiterated its Buy rating on Lucky Strike, maintaining a $12 price target, and noted that the recent real estate acquisition could positively impact the company’s long-term financial health. Texas Capital Securities initiated a Buy rating with a $14 price target, highlighting potential operational efficiencies and a return to positive same-store sales by fiscal year 2026.

In addition, Lucky Strike has appointed Richard Born and Jason Harinstein to its Board of Directors, bringing expertise in hospitality, real estate, finance, and technology. Stifel recently adjusted its price target from $13 to $12, citing challenges in the events business but suggesting potential improvements in same-store sales and other business segments. The company financed its recent acquisition through a combination of a bridge facility, revolving credit, and cash on hand. These developments reflect Lucky Strike’s ongoing efforts to optimize its capital structure and strengthen its market position.

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