Fast food operator snaps up Euro deal
The operator of KFC and Sizzler restaurants has bought the restaurants from subsidiaries of Yum! Brands Inc, one of which will govern the roll-out of over 20 new KFC restaurants in the Netherlands by 2021.
The acquisition and associated equity raising costs will be funded via a fully underwritten A$54.5 million.
Mark van ‘t Loo has been appointed as CEO Europe and has 17 years’ of experience with the KFC-chain in Europe. He will also be responsible for Collins Foods’ Netherlands and German operations and joins the newly established board of Collins Foods Europe Ltd which will also include Graham Maxwell, Nigel Williams and Nigel Clark, an independent, and a UK based Director.
Meanwhile, Collins also announced its revenue was up 12.3 per cent to A$247.2 million for the first-half, with underlying EBITDA up 5.4 per cent to A$30.7 million.
The Dutch restaurants are located in Amsterdam, the Hague, Almere and a number of cities in the South of the Netherlands.
“The Netherlands is a highly attractive market which is under-penetrated for KFC restaurants and the acquisition portfolio is a high quality business which is growing and generates strong margins,” said Graham Maxwell, MD and CEO of Collins Foods.
“This transaction immediately increases our footprint in Europe to 28 KFC restaurants, providing increased economies of scale.”
Maxwell said the acquisition is expected to be mid single digit EPS accretive for Collins Foods shareholders in the first full financial year of ownership (i.e. FY2019), inclusive of expected new restaurant builds over this period.
“Equally as important, the transaction reinforces the strong confidence that Yum! has in Collins Foods as a strong operator of KFC restaurants both in Australia and in Europe.”
Collins Foods’ KFC European business will operate independently from its KFC Australian business.
A European head office, including European CEO and head of finance, will lead the Netherlands and German operations and be supported by local support centres.
Collins said the acquisition adds critical scale to the recently acquired operations in the adjacent market of Germany and that the Netherlands is an “attractive, underpenetrated market for KFC with low country risk.”
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