The first week of July 2011 produced two blockbuster deals in the restaurant industry, with the
announcements of the sale of both the Arby’s and California Pizza Kitchen chains to private equity firms. A week later, Florida-based Publix Super Markets announced the sale of its Crispers restaurant chain.
Sandwich chain Arby’s, once part of the Wendy’s/Arby’s Group Inc. (and of Triarc Companies before that), is now owned by an affiliate of Roark Capital Group. Roark acquired the Wingstop chain in April 2010 and in June 2011 purchased the Il Fornaio/Corner Bakery Cafe operations. The company also owns FOCUS Brands, the operator of Cinnabon, Carvel Ice Cream, Moe’s Southwest Grill and others, and McAlister’s Corporation. At the end of the most recent fiscal quarter, there were 3,631 Arby’s restaurants.
The Chain Store Guide Database of Restaurant Locations reveals the top five U.S. markets for the Arby’s chain are:
CBSA
Count
Chicago-Joliet-Naperville, IL-IN-WI
89
Atlanta-Sandy Springs-Marietta, GA
82
Detroit-Warren-Livonia, MI
74
Dallas-Fort Worth-Arlington, TX
65
Cincinnati-Middletown, OH-KY-IN
58
Upscale pizza chain California Pizza Kitchen (CPK) was acquired by San Francisco-based Golden Gate Capital, a firm with extensive investments in both foodservice and retail. Current holdings include Macaroni Grill and On The Border in the restaurant industry, and Express, The Limited, J. Jill Stores and others in the apparel industry. Other investments are in software and IT services, electronics, semiconductors, and other channels. Golden Gate Capital’s home page notes that it specializes in four basic types of acquisition: public-to-private (CPK), corporate extractions (J. Jill, Macaroni Grill, On The Border), bankruptcy acquisitions (Eddie Bauer, Melita), and recapitalizations (Escalate Retail). There are currently 266 restaurants operating as part of the CPK company, including the eponymous California Pizza Kitchen as well as CPK Express and LA Food Show Grill & Bar.
The top five U.S. markets for CPK include:
CBSA
Count
Los Angeles-Long Beach-Santa Ana, CA
49
New York-Northern New Jersey-Long Island, NY-NJ-PA
13
Chicago-Joliet-Naperville, IL-IN-WI
10
Miami-Fort Lauderdale-Pompano Beach, FL
8
San Francisco-Oakland-Fremont, CA
8
Publix acquired the Crispers chain a few years ago after making several equity investments. Crispers was operated as an ancillary business, with the restaurants being used to test soups, breads, desserts, and other products that the grocery chain was considering adding to its in-store lineup of ready-to-eat foods. The restaurant chain never grew much beyond its initial size, and all locations are in Florida, primarily in the Tampa CBSA. The proposed sale to an affiliate of Boyne Capital was announced in May and finalized in early July. Publix has announced that it plans to focus on its core grocery business, while the new Crispers owners have announced plans to expand the chain within Florida and eventually to enter new markets outside the state.
In addition to a lot of real estate changing hands, what does all of this buying and selling mean to the business community? For starters, the new owners are going to be analyzing their freshly acquired operations in depth, finding problems and developing solutions. Locations that aren’t producing well are likely to be closed, resulting in vacant storefronts. New management may be brought in from outside, a boon for executive search firms who can hook up with these funds. New distributors and service providers may be sought, providing growth opportunities for companies that can bring new economies to these operations. New hardware and software systems may be implemented to make the operations more efficient and profitable. New markets may be identified for targeted growth, a potential windfall for realtors and mall developers looking to fill their excess space.

Linda Helman, Senior Editor 
Linda has worked at Chain Store Guide for twelve years. Prior to that, Linda worked as a research economist for the federal government, as an analyst for a management consulting firm and as a freelance writer. Please 
contact her if you have questions or comments.