4Fingers acquires 50 per cent stake in Mad Mex
The acquisition comes after Mad Mex was placed on the market earlier this week in an attempt to attract investment after posting consistently strong earnings reports. The chain has achieved over 4 per cent like-for-like sales growth over the past two quarters, a sharp contrast to the broader food and beverage marketplace, which is facing structural challenges.
The deal is projected to see the two groups’ combined revenue reach in excess of S$120 million for FY19.
While 4Fingers continues to diversity its global portfolio, the partnership is expected to boost Mad Mex’s international expansions through Southeast Asia. A number of potential locations in both Singapore and Malaysia have been shortlisted as primary targets for Mad Mex’s international rollout.
Clovis Young, Mad Mex founder and former majority stakeholder, will remain as CEO and retain a 50 per cent stake in the business as the brand continues growth in the domestic market.
Young said the brand was excited to be partnering with a renowned global brand that aligned with Mad Mex’s firm focus on the customer service and quality.
“I started Mad Mex in 2006, because I absolutely love Mexican food. But there is a lot of Mexican food out there, and to be honest it’s mostly mediocre,” Young said.
“I wanted my customers to get a fast meal, but with homemade quality, made entirely of real ingredients, with the fewest preservatives, oils, and sugars possible. You should never have to choose between a quick meal and quality healthy food”.
The brand acquisition will enable the group to continue to aggressively scale up its management bandwidth, leveraging a combined network of supply chain processes, shared services and other scale economies.
Vijay Sethu, director of 4Fingers, said the acquisition of Mad Mex marked a significant milestone in the group’s growth strategy.
“We are very excited with our investment in Mad Mex and look forward to working with Clovis to further grow this business in Australia and New Zealand and to rollout the Mad Mex brand in Asia.
“Mad Mex is the second key brand in the 4Fingers Group. We are currently on the lookout for a third brand to complete this platform; a brand with similar characteristics to 4Fingers and Mad Mex – strong, established, profitable and fast-growing that is easily scalable and has global potential”.
Management within the 4Fingers team will also be bolstered to support regional and international growth opportunities, with over 20 new support-office members set to be added to the finance and accounting, HR, purchasing, IT and marketing branches of the Singapore and Kuala Lumpur headquarters.
4Fingers will also continue to focus on growing its flagship brand, with the brand’s maiden US-based outlet set to open in Los Angeles, California, in Q4 of 2018.
Author: Nick Hall
This story originally appeared on sister-site Inside Franchise Business.
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