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SPB Hospitality Agrees to Acquire J. Alexander’s Holdings Inc.
July 2, 2021
$220 million transaction will build on the success of SPB Hospitality’s existing portfolio with the addition of polished casual brands
Houston, TX (RestaurantNews.com) Today, SPB Hospitality, an industry leading operator and franchisor of steakhouses, pizza and craft brewery restaurants, announced that it has agreed to acquire J. Alexander’s Holdings Inc. at $14.00 per share in an all-cash merger, which equates to an equity value of approximately $220 million. This represents a 14% premium over J. Alexander’s closing price on July 1, 2021, which was the last trading day prior to entering into the definitive merger agreement. The transaction is expected to close early in the fourth quarter of 2021, subject to customary closing conditions including the approval of the merger by J. Alexander’s shareholders.
J. Alexander’s Holdings, Inc. operates 47 upscale restaurants with award-winning brands including J. Alexander’s, Stoney River Steakhouse and Grill, Redlands Grill, Overland Park Grill and Merus Grill. For more than 30 years, J. Alexander’s guests have enjoyed a contemporary American menu and unparalleled polished service.
“We are honored to acquire these storied brands and look forward to welcoming this experienced team into the SPB family,” said SPB Hospitality Chief Executive Officer Jim Mazany. “This acquisition advances our vision to become the industry leader and a pioneer of hospitality, while developing our portfolio of brands and delivering best-in-class returns, one great restaurant at a time.”
Morgan McClure, President of SPB Hospitality and Managing Director at Fortress Investment Group, stated, “We have enormous confidence in SPB leadership and their vision for building a true industry leader in the hospitality space. J. Alexander’s exceptional team and established brands mark an important addition to the SPB family and a significant step forward in achieving SPB’s vision.”
J.P. Morgan Securities LLC and Configure Partners LLC served as financial advisors and Hunton Andrews Kurth LLP served as legal counsel to SPB Hospitality and Fortress Investment Group. Piper Sandler & Co. served as financial advisor to J. Alexander’s Holdings Inc. and Bass, Berry & Sims PLC acted as the company’s legal counsel.
About SPB Hospitality
SPB Hospitality is a leading operator and franchisor of full-service dining restaurants, spanning a national footprint of hundreds of restaurants and breweries in 38 states and the District of Columbia. Based in Houston, the company’s diverse portfolio of restaurant brands includes Logan’s Roadhouse, Old Chicago Pizza & Taproom, Rock Bottom Restaurant & Brewery, Gordon Biersch Brewery Restaurant, and a collection of specialty restaurant concepts. For more information about SPB Hospitality, visit spbhospitality.com.
About J. Alexander’s Holdings, Inc
J. Alexander’s Holdings, Inc. is a collection of restaurants that focus on providing high-quality food, outstanding professional service and an attractive ambiance. The Company presently operates 47 restaurants in 16 states. For additional information, visit JAlexandersHoldings.com.
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Fiesta Restaurant Group, Inc. Enters Into Definitive Agreement for the Sale of Taco Cabana to an Affiliate of Yadav Enterprises, Inc.
Sale Will Enable Increased Focus on Pollo Tropical Growth Opportunity
Transaction Proceeds to Fully Repay Term Loan Borrowings
Cash Balance as of June 27, 2021 of $67.6 million
July 01, 2021 08:00 AM Eastern Daylight Time
DALLAS--(BUSINESS WIRE)--Fiesta Restaurant Group, Inc. ("Fiesta" or the "Company") (NASDAQ: FRGI) today announced that it has entered into a definitive stock purchase agreement for the sale of the Taco Cabana® restaurant brand to YTC Enterprises, LLC, an affiliate of Yadav Enterprises, Inc. ("Yadav"), a restaurant company that operates close to 400 locations throughout Northern California, Texas and sixteen other states.
Taco Cabana Divestiture and Use of Proceeds
The Company’s stock purchase agreement with Yadav provides for the sale of all of the outstanding capital stock of Taco Cabana, Inc., the parent company of the Taco Cabana business, for a cash purchase price of $85 million, subject to reduction for certain working capital and other closing adjustments estimated in the aggregate amount of approximately $7 million to $9 million (excludes Winter Storm Uri insurance proceeds to be received by Fiesta). The transaction is expected to close in the third quarter of 2021, subject to the satisfaction of customary closing conditions. Proceeds from the sale will be used to fully repay Fiesta’s approximately $74.6 million of outstanding term loan borrowings under Fiesta’s senior credit facility and to pay divestiture transaction fees and a loan prepayment premium totaling approximately $4.6 million(1). As of June 27, 2021, the Company cash balance was $67.6 million. Subsequent to the transaction close, a portion of those funds will be used for investments to accelerate Pollo Tropical's ® growth. In addition, the Company’s Board of Directors will be evaluating additional strategies for increasing shareholder value including potential future stock repurchases.
Fiesta President and Chief Executive Officer Richard Stockinger stated, “We made the strategic decision to sell the Taco Cabana business to allow our leadership team to focus completely on accelerating Pollo growth, and we are very excited about the tremendous growth opportunities we have for the Pollo Tropical business.”
Richard Stockinger added, “Anil Yadav, the CEO of Yadav Enterprises, has an impressive entrepreneurial background and is a highly-respected restaurant operator with a proven record of success across a variety of limited and full-service concepts. We are confident he will be an effective steward of the Taco Cabana brand for the long-term.”
Driving Growth of Pollo Tropical
Stockinger concluded, “We believe the Taco Cabana sale will provide great value to our shareholders, allowing us to create a more effective, efficient and focused organization, applying appropriate resources to accelerate delivery of the exciting growth potential we have in our Pollo Tropical brand. This will include our continued efforts to drive an upgraded customer experience across all service channels, continuing to invest in expanding our growing digital platform and finalizing our new unit expansion plans targeted for 2022.”
Amount comprised of a loan prepayment fee of 3% of the principal repaid of $2.2 million and divestiture transaction fees estimated at approximately $2.4 million. As part of the transaction, unamortized debt issuance costs from the existing senior credit facility of $3.5 million will also be recorded as an expense.
About Fiesta Restaurant Group, Inc.
Fiesta Restaurant Group, Inc., owns, operates and franchises the Pollo Tropical® and Taco Cabana® restaurant brands. The brands specialize in the operation of fast casual/quick service restaurants that offer distinct and unique flavors with broad appeal at a compelling value. The brands feature fresh-made cooking, drive-thru service and catering. For more information about Fiesta Restaurant Group, Inc., visit the corporate website at www.frgi.com.
For the year ended January 3, 2021, Taco Cabana generated total revenues of $239.4 million and Adjusted EBITDA of $8.5 million. As of July 1, 2021, there were 142 company-owned and operated Taco Cabana restaurants located in Texas and six franchised Taco Cabana restaurants located in New Mexico.
About Yadav Enterprises, Inc.
Yadav Enterprises, Inc. is a restaurant company operating close to 400 locations throughout Northern California, Texas and sixteen other states. Yadav is the largest Jack in the Box® franchisee, one of the largest Denny’s® franchisees, the largest TGI Friday’s® franchisee and a significant investor in the ownership group of TGI Friday’s® global parent company, and a franchisee of El Pollo Loco® and Corner Bakery Cafe®.
View source version at Fiesta Restaurant Group
Ampex Brands Acquires Au Bon Pain
Longtime Yum! franchisee expands to franchisor, assumes operations of legacy brand
June 30, 2021 08:02 AM Eastern Daylight Time
DALLAS--(BUSINESS WIRE)--Ampex Brands, a Yum! Brands Inc. and 7-Eleven franchisee with more than 400 restaurants and convenience stores, today announced it acquired Au Bon Pain from ABP Corporation, a subsidiary of Panera Bread. The deal was finalized on June 29.
Au Bon Pain’s 171 locations will join the Ampex Brands family and increase the company’s revenue by approximately 10% annually. The acquisition also grants Ampex franchising rights to an additional 131 locations.
“We see a solid future for both Au Bon Pain and our broader portfolio,” said Ampex CEO Tabbassum Mumtaz. “Our QSR brands performed extraordinarily well throughout the pandemic as guests moved to drive-thru. That performance allowed us to diversify and jump on a great opportunity to reposition a legacy brand. The bakery café category will rebound, and Au Bon Pain is well-positioned to grow.”
A longtime franchisee of Pizza Hut, KFC, Taco Bell, Long John Silver’s and 7-Eleven, Ampex will now assume the role of the franchisor for the first time in its 16-year history. The acquisition also expands the company’s footprint internationally.
Ampex will apply its successful operating strategy to ramp up Au Bon Pain’s existing cafés starting in the brand’s key markets in the Northeast and mid-Atlantic. Once existing cafés are reopened and executing with positive results, Ampex will kick off expansion efforts, starting with corporate-owned locations.
Mumtaz has assembled a diverse team of franchise and operations experts to lead the Au Bon Pain brand, including Ericka Garza as Brand President. Garza has spent her career growing franchising for both domestic and international QSR brands, casual dining and C-Store segments. Most recently, she managed domestic traditional and nontraditional business as the Senior Franchise Growth Leader for Pizza Hut, operated by Yum! Brands, the world’s largest restaurant company.
“The US is reopening, and our markets are coming back to life,” said Garza. “As we open our cafés, Au Bon Pain’s brand reputation, loyal following, strong real estate and menu position the brand favorably for success. We also see opportunity in its nontraditional locations, currently in transportation hubs, airports, universities and hospitals. Smaller footprints with less dine-in seating are the future of fast-casual dining, and having a successful prototype with long-standing institutional relationships allows for flexibility as we grow.”
Au Bon Pain’s new leadership will also include Brian Bacica as Chief Operating Officer. Bacica has spent more than 30 years in hospitality, including 18 years in food and beverage leadership roles for Disneyland, Universal Studios Hollywood and Universal Orlando Parks and most recently as CEO of PEAK Event Services.
Beth Collins will serve as Ampex Brands’ first Global Chief Marketing Officer, overseeing brand responsibilities for both Au Bon Pain and Ampex Brands. Collins is a 20-plus-year C-level marketing veteran in the fast-casual, casual dining and entertainment industries with companies such as Raising Cane’s, Texas Land & Cattle/Lone Star Steakhouse, Twin Peaks and Lucky Strike Entertainment.
Since its founding in 2005, Ampex has built its name as a franchisee, with a booming portfolio of brands in the C-Store and QSR segments. Today, the company boasts revenues of nearly half a billion dollars, with aggressive growth plans to expand into additional corporate-owned, franchisor businesses.
ABOUT AMPEX BRANDS Founded in 2005 by Tabbassum Mumtaz, Ampex Brands LLC is a Yum! Brands and 7-Eleven franchisee with almost 600 QSR and fast-food restaurants and convenience stores. The Richardson, Texas-based company has a total of 701 employees across all its locations. The fast-growing company acquired the Au Bon Pain brand in 2021, catapulting the company into the franchisor role and expanding its footprint internationally.
View source version at Ampex Brands
FAT Brands Inc. Agrees to Acquire Global Franchise Group for $442.5 million
June 28, 2021 06:00 ET
Largest Restaurant Acquisition of 2021 to include Round Table Pizza®, Great American Cookies®, Hot Dog on a Stick®, Marble Slab Creamery® and Pretzelmaker®
Combined System-wide sales of approximately $1.4 billion
LOS ANGELES, CA, June 28, 2021 (GLOBE NEWSWIRE) -- FAT (Fresh. Authentic. Tasty.) Brands Inc. (NASDAQ: FAT) (the “Company”) today announced that it has agreed to acquire Global Franchise Group, which franchises and operates a portfolio of five quick service restaurant concepts, Round Table Pizza, Great American Cookies, Hot Dog on a Stick, Marble Slab Creamery and Pretzelmaker, from Serruya Private Equity, Inc. and Lion Capital LLP, for $442.5 million in cash and stock.
The cash portion of the purchase price will be funded from the issuance of a new series of notes and cash on hand. The Company will also issue to the sellers $25 million in common stock and $67.5 million in Series B cumulative preferred stock. The transaction is expected to close by the end of July 2021, subject to expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act.
With the acquisition of GFG, FAT Brands will have more than 2,000 franchised and company owned restaurants around the world with combined annual system-wide sales of approximately $1.4 billion. Approximately 87% of GFG’s stores are located in the United States. Based on current projections and assumptions, including realization of expected synergies and return to pre-COVID restaurant sales, the acquisition is expected to eventually increase annual EBITDA by approximately $40 million to approximately $55-$60 million.
“This acquisition is a key strategic milestone for FAT Brands. We have been very acquisitive in recent years, seeking to add strong and growing restaurant brands to our portfolio. Now that the economy is emerging from COVID-19 and restaurants are rapidly recovering, we are pleased to have reached this agreement to incorporate a powerhouse restaurant franchising group with the support of Serruya Private Equity and Lion Capital,” said Andy Wiederhorn, President and CEO of FAT Brands. “The five new restaurant concepts have been very resilient coming out of the pandemic and will complement our existing brands. Furthermore, we will acquire GFG’s manufacturing operations, which will provide greater efficiencies and incremental revenue opportunities to our company.”
“This is truly a transformative deal for both FAT Brands and GFG. Andy has an exciting vision for FAT Brands and through his recent acquisitions, he has been able to create brand synergies within the portfolio while maintaining an asset-light business model,” said Michael Serruya, Managing Director at Serruya Private Equity and Chairman of the Board of GFG. “I look forward to our continued involvement with GFG through our company’s support of FAT Brands from an equity and strategic perspective.”
Lyndon Lea, Managing Partner of Lion Capital, added: “We are incredibly thankful to the management team of GFG, for their incessant focus on building a great business and culture, while successfully navigating an unprecedented period amidst COVID-19. We wish FAT Brands and GFG the best in the next phase of their journey.”
Duff & Phelps Securities, LLC served as financial advisor to GFG and Serruya Private Equity. Sheppard, Mullin, Richter & Hampton LLP and Greenberg Traurig, LLP acted as legal counsel to FAT Brands. Bryan Cave Leighton Paisner LLP acted as legal counsel to Serruya Private Equity and Lion Capital.
About FAT (Fresh. Authentic. Tasty.) Brands
FAT Brands (NASDAQ: FAT) is a leading global franchising company that strategically acquires, markets and develops fast casual and casual dining restaurant concepts around the world. The Company currently owns nine restaurant brands: Fatburger, Johnny Rockets, Buffalo’s Cafe, Buffalo’s Express, Hurricane Grill & Wings, Elevation Burger, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses, and franchises approximately 700 units worldwide. For more information, please visit www.fatbrands.com.
About Global Franchise Group, LLC
Global Franchise Group, LLC is a strategic brand management company with a mission of championing franchise brands and the people who build them. The company builds great brands that connect people with craveable products and memorable experiences. GFG currently supports more than 1,400 franchised and corporate stores in 16 countries across five quick service restaurant concepts: Round Table Pizza, Great American Cookies, Hot Dog on a Stick, Marble Slab Creamery and Pretzelmaker. Global Franchise Group, LLC is an affiliate of Serruya Private Equity, Inc. and Lion Capital LLP.
View source version at FAT Brands
BBQ Holdings, Inc. Announces Acquisition of Village Inn and Bakers Square Restaurants and Updates Earnings Guidance for Fiscal Year 2021
June 28, 2021 08:00 ET
MINNEAPOLIS, June 28, 2021 (GLOBE NEWSWIRE) -- BBQ Holdings, Inc. (NASDAQ: BBQ) (the “Company”), an innovating global owner and operator of restaurants, provided revenue and earnings guidance in an updated investor presentation filed via Form 8-K on June 25, 2021, reflecting the announcement of the acquisition of Village Inn and Bakers Square, as well as improved operations within BBQ Holdings, Inc’s existing brands. Guidance for its fiscal year 2021 is as follows:
Included in the transaction are 114 franchised Village Inn restaurants, 21 Corporate Village Inn restaurants, and 13 Corporate Bakers Square restaurants.
We are increasing 2021 guidance as follows:
Net Restaurant Revenue from $155-$160 mm to $180-$185 mm
Net Income from $2.8-$3.2 mm to $5.1-$5.5 mm
Cash EBITDA from $10.0-$10.5 mm to $13.5-$14.0 mm ($12.0-$12.5 mm from current BBQ operations and $1.5 mm 2021 pro-rata contribution from the Acquisition)
An Investor Presentation can be found here https://ir.bbqholdco.com/
We plan to launch the new Village Inn prototype for growth in early 2022 and begin expanding the sale of Bakers Square pies through retail and other restaurant kiosks in Q4 of 2021.
Executive Comments
Jeff Crivello, CEO, commented, “We are excited to increase our revenue, and earnings guidance for fiscal year 2021. This guidance is a reflection of our organic and M&A growth plans. We believe this acquisition will be accretive to our earnings and that there is a significant amount of pent-up demand for dining, and we expect that demand to grow throughout the year at our existing brands. We will provide future guidance as the year develops.”
About BBQ Holdings
BBQ Holdings, Inc. (NASDAQ: BBQ) BBQ Holdings is a national restaurant company engaged in the ownership and operation of casual and fast dining restaurants. As of April 4, 2021, BBQ Holdings had four brands with 136 “brick and mortar” locations in 31 states and three countries, including 47 company-owned and 100 franchise-operated restaurants. In addition to these locations, the Company opened eight Company-owned Famous Dave’s ghost kitchens operating within its Granite City locations, and 11 Famous Dave’s franchisee ghost kitchens operating out of the kitchen of another restaurant location or a shared kitchen space. While BBQ Holdings continues to diversify its ownership in the restaurant community, it was founded with the principle of combining the “art and science” of barbecue to serve up the very best of the best to barbecue lovers everywhere. BBQ Holdings, through partnerships, has extended Travis Clark’s award-winning line of barbecue sauces, rubs and seasonings into the retail market. Along with a wide variety of BBQ favorites served at their BBQ restaurants, BBQ Holdings newest addition, Granite City Food and Brewery, offers award winning craft beer and a made-from-scratch, chef driven menu featuring contemporary American cuisine.
View source version at BBQ Holdings
Darden Restaurants Reports Fiscal 2021 Fourth Quarter and Full Year Results; Increases Quarterly Dividend; And Provides Fiscal 2022 Outlook
Jun 24, 2021, 07:00 ET
ORLANDO, Fla., June 24, 2021 /PRNewswire/ -- Darden Restaurants, Inc. (NYSE:DRI) today reported its financial results for the fourth quarter and fiscal year ended May 30, 2021.
Fourth Quarter Financial Highlights, Comparisons to Fourth Quarter Last Year and Fourth Quarter Fiscal 2019
Total sales increased 79.5% to $2.28 billion driven by a blended same-restaurant sales increase of 90.4% and the addition of 30 net new restaurants, partially offset by one less week of operations this year
Same-restaurant sales:
Same-restaurant sales (open 16 months or greater):
Comparable to 2020
Comparable to 20191
Consolidated Darden
90.4%
(0.5)%
Olive Garden
61.9%
(1.5)%
LongHorn Steakhouse
107.5%
13.5%
Fine Dining
143.6%
(10.6)%
Other Business
160.7%
(9.4)%
Reported diluted net earnings per share was $2.79 as compared to a reported diluted net loss per share of $3.85 last year
Adjusted diluted net earnings per share was $2.03, after excluding a non-recurring income tax benefit of $0.76, as compared to adjusted diluted net loss per share of $1.24 last year2
EBITDA of $412 million2
"We had a strong quarter that exceeded our expectations as sales improved throughout the quarter," said Darden Chairman & CEO Gene Lee. "I am proud of how our teams welcomed more of our guests back and created memorable experiences. Over the last 15 months, we have made numerous strategic investments in our business, while streamlining our operations and improving productivity. Given the business transformation work we have done, and the demand we are seeing from the consumer, we are well positioned to thrive in this operating environment."
View full version at Darden Restaurants
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