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Fat Brands to acquire Twin Peaks in $300M deal with Garnett Station Partners

Polished-casual-dining sports chain will add as much as $30M to Fat Brands’ EBITDA, 88 restaurants

Twin Peaks has agreed to acquire polished-casual-dining sports chain Twin Peaks from Garnett Station Partners for $300M. Fat Brands, which operates and franchises a portfolio of quick-service, fast-casual and casual-dining chains, including Fatburger, Johnny Rockets and Great American Cookies, will fund the deal with $50M in preferred stock issuance to the sellers and $250M in proceeds from new securitization notes.

Acquisition-hungry Fat Brands has grown considerably over the years through its purchase of restaurant chains from a variety of segments. By adding the 88 Twin Peaks restaurants that will be open by the end of the year, and the development pipeline of 18 new units, due to open in as many months, Fat Brands projects its sales to rise post-acquisition from about $1.4B to $1.8B. In addition, its normalized EBITDA will increase by approximately $25M to $30M post-COVID.

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“Twin Peaks is a noteworthy addition for Fat Brands,” said Andy Wiederhorn, Fat Brands chief executive. “Following the recent acquisitions of Johnny Rockets and Global Franchise Group, this acquisition comes at a time when we’re seeking to expand our market segments into sports and polished casual dining. As a strong, growth-oriented concept, Twin Peaks complements our existing brands. The average unit volumes between $4.5 million and $6.5 million for new units is at the high end of industry growth standards. The exceptional unit economics and proven track record of the Twin Peaks brand has led to extraordinary demand for new store openings from new and existing franchisees.”

Fat Brands executives are optimistic about the prospects of domestic and international expansion of the Twin Peaks restaurant concept. The purchase of Twin Peaks will close by the end of September.

[Related article: Fat Brands completes acquisition of Global Franchising Group]

“Since our investment, Twin Peaks has become one of the fastest growing sports-themed, bar-forward concepts in the sector,” added Matt Perelman, managing partner at Garnett Station Partners. “We’re thankful for Andy’s partnership as we move forward with this deal and are confident that Twin Peaks will continue its success under Fat Brands.”

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Duff & Phelps Securities, LLC served as financial advisor to Garnett Station Partners, while Kirkland & Ellis LLP provided legal counsel. Greenberg Traurig LLP provided legal counsel to Fat Brands on the transaction.

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