Church’s Chicken Sold
Church’s Chicken has flown Arcapita’s Coop. The Bahrain-based investment firm sold the 1,600-unit chicken chain to an affiliate of Friedman, Fleischer & Lowe, a San Francisco private equity firm, for a reported $400 million. It’s the first leveraged buyout of more than $100 million in nearly a year.
A group of lenders are financing the deal (which hadn’t closed at press time), including Bank of America, Golub Capital and Wells Fargo, which arranged a $150 million loan to back the buyout.
While that clearly means there is life in the credit markets, the deal also signals confidence in Church’s strength. CEO Harsha Agadi spoke of 700 more stores in the pipeline.
In the five years Arcapita has owned Church’s, the chain has seen its earnings grow 60 percent. "Given the very constrained credit environment, as well as the sustained economic downturn, this announcement is a significant achievement for Arcapita and our investors," said Atif A. Abdulmalik, Arcapita’s CEO. Agadi will remain Church’s CEO.
Investment Boost Keeps Submarina Buoyant
California-based Submarina California Subs recently received a significant investment boost from Kerensa Investment Fund, a deal that will enable the 32-year-old chain to expand in the future.
The 65-unit chain opened 18 units last year and is poised to open another 20 this year. CEO Jeff Warfield said the deal will allow the chain to finance additional marketing to increase the brand’s presence and draw more in-store traffic.
The investment deal was contingent on maintaining Submarina’s senior management team, including Warfield, president and chief operating officer Mimi Zeller, and Charles Lynn Lowder, executive vice president of administration and operations.
Franchise Consulting Adds Paisano’s to Roster
Virginia-based Franchise Consulting LLC announced the addition of Italian restaurant chain Paisano’s to its family of clients. "Paisano’s has proven its solid business model for over a decade," said Mike Halpern, Franchise Consulting’s founder and CEO. He added that the company hopes to have 10 development agreements signed for the D.C. metro area by 2010.
Other brands that have used Franchise Consulting’s services include Camille’s Sidewalk Café, Coney’s and FreshBerry Frozen Yogurt Café.
Restaurateur Norman Brinker dies
Norman E. Brinker, namesake and chairman emeritus of franchisor Brinker International, died June 9. He was 78.
Brinker’s first major contribution to the restaurant industry came in the 1960s when he founded Steak & Ale. After selling the chain to Pillsbury in the mid-’70s, Brinker served on that company’s restaurant operations team as an executive vice president and established another well-known restaurant, Bennigan’s. Eventually, he would leave Pillsbury to oversee the development of Dallas-based casual dining chain Chili’s.
Doug Brooks, president and CEO of Brinker International, said Brinker was an inspiration to many in the restaurant business. "He had a passion for winning—and he always won with integrity," he said, "which is why Norman is universally admired by the restaurant industry."
Brinker helped found the Susan G. Komen for the Cure organization, which supports breast cancer research. In addition, he received an Augie Award from the Culinary Institute of America—which inducted Brinker into its hall of fame in 2007.
Brinker is survived by his family, as well as his company and its roster of brands, which includes On The Border Mexican Grill & Cantina and Maggiano’s Little Italy.
Dunkin’ Brands Joins Ceres
Ceres, a coalition of investors, environmental groups and public interest organizations, announced Dunkin’ Brands as the newest addition to its network of companies.
Mindy Lubber, Ceres’ president, said Dunkin’ had continued to demonstrate "positive steps towards creating an effective sustainability program," including a switch to Fair Trade-certified coffee beans and the opening of its first LEED store (Leadership in Energy and Environmental Design) in 2008.
Dunkin’ Brands, the franchisor of Dunkin’ Donuts and Baskin Robbins, is now among over 80 other Ceres member companies working to address issues regarding global sustainability.
PostNet Wins
PostNet Canada—an office business support center has earned a new trophy: Top honors in the Canadian Franchise Association’s "Traditional Franchises New/Emerging" category. Members of the CFA—both franchisors and franchisees alike—choose the winners via survey. The CFA has been presenting awards to notable franchises since 1992, and to be considered for the awards, a company must be a member of the CFA, follow the association’s best practices and have been a franchise for three or more years. This is the first year PostNet, which runs more than 900 franchises worldwide and offers services in printing and copying, graphic design, scanning, packing and shipping, has been eligible for the awards, though the concept has been franchised since 1993.
Kyro Pizza to Franchise its Multicultural Pies
Last month, Beautiful Brands International (BBI) announced that it would be developing, supporting and franchising Baltimore’s Kyro Pizza, a fast casual restaurant that specializes in brick-oven pies topped with zany, "creative" concepts. Though individual Kyro stores don’t take up much space (only about 1,200 to 1,500 square feet,) the powers that be are thinking big, with sights set on a global presence. BBI’s stable of brands and clients includes FreshBerry Frozen Yogurt Café, Dixie Cream Donuts and Camille’s Sidewalk Café.
