A source with knowledge of the matter confirmed to EW that Chick-FIL-A has secured an $80 million loan for its Chick-Fat Chick apparel and footwear business from American Funds, a private equity firm that previously invested in a number of other apparel companies.
Chick-FATC, as the company is known, was acquired by American Funds in 2016, and it was not immediately clear how the company plans to proceed with the acquisition.
The source said that the loan, as well as an agreement with the US Department of Labor to be eligible for up to $5 million in federal aid, would be used to “add to our existing portfolio of apparel and clothing solutions.”
While it is not clear if Chick-fat Chick will sell off all of its apparel business, the source indicated that the retailer will be able to sell off some of its assets.
The Chick-fattah Chick-Chick brand will continue to exist on the American Funds’ behalf, as will its operations at the new Chick-Fish, a retail outlet and restaurant slated to open in Chicago.
A source familiar with the matter told EW that the Chick-Fi Chick brand will also be sold, though the exact details of what is being sold have not yet been determined.
In addition to the Chick Fil-A acquisition, Chick-fi has also secured a loan from the US Export-Import Bank.
The loan is expected to be paid back over the next five years.
The US Export Import Bank was founded in 1994 to provide loans for foreign companies to finance domestic production.
In 2015, the bank approved $5.8 billion in loans for companies that were in the food, clothing, furniture, and consumer goods sectors.
The bank has also issued loans for private equity funds.