The financial landscape for Twin Hospitality is facing significant upheaval as its parent company, FAT Brands, embarks on a critical debt restructuring initiative. With a staggering $1.2 billion debt burden, FAT Brands has signaled its intent to divest its substantial 95% ownership in Twin Hospitality, a move that is poised to create considerable selling pressure on TWNP shares.

This strategic divestment by FAT Brands, recently disclosed through an SEC filing, highlights the urgency of its financial situation. The decision to liquidate a majority stake in Twin Hospitality is a direct response to the immense debt, prompting FAT Brands to engage restructuring advisors. This development follows a similar action by its creditors, who have enlisted Houlihan Lokey, underscoring the severity of the financial challenges at hand.

The anticipated sale of TWNP shares by FAT Brands is expected to have a profound impact on Twin Hospitality's stock price. Given the relatively low average daily trading volume of TWNP, a large-scale sale by a major shareholder like FAT Brands could easily overwhelm the market. This imbalance between supply and demand is likely to drive the stock's value downwards, creating a volatile period for current and prospective investors.

The impending liquidation of FAT Brands' stake in Twin Hospitality is a direct consequence of its substantial debt and the subsequent need for restructuring. This move is projected to introduce significant downward pressure on Twin Hospitality's stock, given the market's limited capacity to absorb such a large volume of shares without a considerable price adjustment.