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GLENDALE, CA-DineEquity Inc., the owner and operator of the IHOP and Applebee’s restaurant chains that formerly was known as IHOP Corp., has completed its previously announced sale-leaseback of 181 company-owned Applebee’s locations to affiliates of New York City-based Drawbridge Special Opportunities Fund. The deal is structured in a way that will reduce DineEquity’s debt by $303 million and generate approximately $296 million in after-tax cash proceeds.

The buyers are Drawbridge Special Opportunities Fund LP, Drawbridge Real Assets Fund LP and Cardinal Capital Partners. The Drawbridge funds are affiliates of Fortress Investment Group, a publicly traded, global alternative asset manager.

The deal was originally expected to include 187 of the Applebee’s locations, but DineEquity says that it excluded six of the previously targeted restaurants “due to technical reasons.” The company, which was known as IHOP Corp. when the deal was announced but has since changed its name, anticipates that it will sell those properties in the future.

The sale-leaseback is one of a number of strategies that DineEquity has been pursuing. As previously announced, for example, DineEquity intends to franchise the large majority of Applebee’s company-operated restaurants over the next two and a half years.

The plan to franchise the Applebee’s locations follows a similar strategy that the company has pursued over the past five years in which it transformed the IHOP brand into a 99% franchised system. DineEquity says that it “believes that it can employ similar strategies to transform and re-energize Applebee’s,” which has been suffering from lackluster same-store sales.

Glendale-based DineEquity Inc. franchises and operates more than 3,300 restaurants under the Applebee’s Neighborhood Grill & Bar and IHOP brands. It reached that size in November 2007 when it completed the $2.1-billion acquisition of Applebee’s International Inc.

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