Global franchising fast casual and casual dining restaurant company FAT Brands Inc. (FAT:NASDAQ) today announced that "it has agreed to acquire the Johnny Rockets restaurant chain from an affiliate of private equity firm Sun Capital Partners Inc. for approximately $25 million."
The firm advised that the purchase will be funded by its cash reserves and proceeds generated from its securitization facility. The company noted that it anticipates that the Johnny Rockets transaction will close in September 2020 and when completed, FAT Brands franchised and company owned restaurants will grow to more than 700 locations worldwide with annual system-wide sales eclipsing $700 million.
Johnny Rockets is an international restaurant franchise founded in 1986 in Los Angeles. The restaurants are known for their iconic 1950s diner style décor. The chain's menu features such items as freshly made burgers and hand-spun shakes made with real ice cream.
The company's President and CEO Andy Wiederhorn commented, "FAT Brands is delighted to carry the torch from the affiliate of Sun Capital Partners Inc., a global private equity leader with deep investment and operational experience, and run hard...Similar to Fatburger, Johnny Rockets got its start in Los Angeles, and we couldn't be more pleased to add another true staple in our home city to our portfolio. This acquisition is a transformative event for FAT Brands in terms of scale and brand awareness. We see a lot of synergy with Johnny Rockets and our current restaurant concepts and we are eager to take the brand to new heights."
FAT Brands is a global franchising company that acquires, markets and develops fast casual and casual dining restaurant concepts worldwide. Presently, the firm owns, operates and franchises eight restaurant brands which include Buffalo's Cafe, Buffalo's Express, Elevation Burger, Fatburger, Hurricane Grill & Wings, Ponderosa and Bonanza Steakhouses, and Yalla Mediterranean and franchises over 375 units worldwide.
FAT Brands started the day with a market capitalization of around $42.0 million with approximately 11.9 million shares outstanding. FAT shares opened 165% higher today at $9.37 (+$5.84, +165.44%) over yesterday's $3.53 closing price and reached a new 52-week high price this morning of $10.25. The stock has traded today between $6.82 and $10.25 per share and is currently trading at $7.60 (+$4.07, +115.30%).
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