US alternatives group TPG has made a $750 million investment in Greek yoghurt manufacturer Chobani via a second lien loan.
The deal is an unusually large credit play for TPG. It made the investment using both its buyout arm, TPG Capital, and its credit platform, TPG Opportunities Partners.
The loan has warrants which could see TPG obtain a stake of between 20 and 35 percent in the company’s equity in the future, subject to certain conditions being met, according to reports. These conditions include a sale of the business, or an IPO. US media reports suggest it could look to go public as soon as next year.
A TPG spokesman declined to comment on the deal beyond the statement issued by Chobani.
New York-based Chobani has reportedly encountered liquidity problems, having opened a manufacturing plant in Ohio at a cost of $450 million. It posted revenues last year of $1 billion.
Chobani chief executive and founder Hamdi Ulukaya said in a statement: “This investment gives us additional resources to build on our momentum, fund our exciting new innovations and reach new people.”
Ulakaya founded the business in 2005 and owns 100 percent of its equity.
Bank of America Merrill Lynch and law firm Kirkland & Ellis advised Chobani on the deal. Ropes & Gray’s Carl Marcellino, Newcomb Stillwell and Alyson Allen provided legal advice to TPG.
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