Foodservice Acquisitions and Mergers: The Latest Report from Chain Store Guide
Early last month, ChainStore Guide released its latest white paper, titled Trading Spaces: Detailing the Top Mergers and Acquisitions of the Year. Several of the 2010-2011 transactions in the foodservice industry lead the list based on the size of the companies involved, notably 3G Capital Management’s acquisition of Burger King Holdings (12,000+ restaurants) and Roark Capital Group’s purchase of Arby’s Restaurant Group from Wendy’s/Arby’s Group (3,600+ locations). Other large restaurant-operator takeovers include Auntie Anne’s (1,100), Bojangles Restaurants (500), Hooters of America (450), Bruegger’s Enterprises (300), California Pizza Kitchen and Noodles & Co. (each 260+).
In spite of what is still a relatively lukewarm domestic economy, the news-making financial struggles at several large foodservice companies (including the bankruptcy filings of Friendly Ice Cream Corp., Dippin’ Dots, and Real Mex Restaurants), and the roller coaster-like movement of Wall Street in recent months, there is still an apparently strong market for restaurant companies. Among the deals recently closed are Canadian-based MTY Food Group’s purchase of Jugo Juice International and Mr. Submarine Limited, Bella Petrella’s acquisition of Philly Westshore Franchising Corp., VPC Pizza Holdings buyout of Giordano’s Enterprises, Interstate Hotels & Resorts purchase of Noble Management Group, and Café International’s takeover of Mountain Mudd Espresso.
Pending deals include MTY Food Group’s buyout of Koryo Korean BBQ, Darden Restaurants purchase of the Eddie V’s Restaurant chain, and most recently announced, Landry’s Restaurants bid for McCormick & Schmick’s Seafood Restaurants. The biggest deal waiting closure is NPC International Inc.’s acquisition by Olympus Partners. NPC is Pizza Hut’s largest franchisee with more than 1,150 restaurants. All transactions are expected to close by the end of 2011 or early in 2012.
Clearly these transactions will have significant impact at the companies that are being acquired as their new owners assess current operations and systems, management effectiveness, marketing and advertising programs, efficiencies to be gained from upgraded MIS systems, and unit-level costs. ChainStore Guide customers have the advantage of knowing when these transactions occur, so they can take advantage of any new initiatives that may be occurring. If you’d like to be among those with in-depth contact information, contact Chain Store Guide at 800.778.9794.