A subsidiary of B. Riley Financial Inc. in Woodland Hills and Kayne Anderson Capital Advisors in Los Angeles will provide a $700 million credit facility to finance the buyout of a furniture store chain.
Franchise Group Inc., a holding company that owns the Liberty Tax Service and Vitamin Shoppe chains, will acquire American Freight Group Inc., a discount furniture retailer, for $450 million. B. Riley and Kayne Anderson will provide the capital for that transaction, as well as assuming the debt from Franchise Group’s previous acquisitions of Buddy’s Home Furnishings and Sears Outlet.
B. Riley will extend the credit through its subsidiary Great American Capital Partners.
“We expect that combining American Freight with our similarly large-format Sears Outlet business and our small-format Buddy’s Home Furnishings business will generate significant economic synergies over time that will be realized from leveraging corporate overhead, vendor and franchisee partnerships, operating methods, and a common customer base,” Brian Kahn, chief executive of Franchise Group, said in a statement.
Franchise Group is based in Virginia Beach, Va., while American Freight Group is headquartered in Columbus, Ohio.