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Fat Brands finalizes $442.5M acquisition of Global Franchising Group

Fat Brands adds Great American Cookies, Hot Dog on a stick, Marble Slab Creamery, Pretzelmaker, Round Table Pizza

Fat Brands completed its acquisition of Global Franchising Group (GFG) for $442.5M, gaining the Great American Cookies, Hot Dog on a Stick, Marble Slab Creamery, Pretzelmaker, and Round Table Pizza brands. The transaction, funded with cash and stock, was the largest by a restaurant franchisor year-to-date, according to the purchaser’s announcement.

The deal included a $350M cash payment from notes Fat Brands had recently issued and cash on hand, $67.5M in Series B preferred stock and $25M in common stock.

The purchase of GFG marks an important milestone for the the parent of brands, like Fatburger, Elevation Burger, Yalla Mediterranean and the Bonanza and Ponderosa Steakhouses. The company, which has grown aggressively through acquisitions, will now increase its portfolio from 700 locations to more than 2,000 globally through the consummation of the deal.

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In addition, the acquisition of GFG will increase Fat Brands’ annual EBITDA by about $40M to $60M, also increasing annual revenues between $36M and $100M. This estimate factors in anticipated synergies and a model reflecting pre-COVID restaurant sales.

“This acquisition is our largest deal yet, and further diversifies our iconic restaurant portfolio into new restaurant segments and categories. As our acquisitions have grown from small chains to global restaurants, Fat Brands is poised to better position itself as a multi-concept operator in the franchise restaurant business,” said Andy Wiederhorn, Fat Brands chief executive.

Moving forward, Fat Brands will also own an Atlanta, Ga.-based manufacturing facility that supports the Global Franchising Group brands and provides incremental revenue opportunities, the company said.

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Wiederhorn added, “Serruya Private Equity and Lion Capital were excellent partners in bringing this transaction to completion. Serruya has been a longtime supporter of our vision and we are grateful to be working with partners who share our enthusiasm for this diverse market.”

The purchase of GFG by Fat Brands follows the notable acquisitions of Johnny Rockets in 2020 and Elevation Burger in 2019.

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