Fat Brands to acquire Fazoli’s for $130 million

Fat Brands continues to add to — and diversify — its restaurant portfolio.

The owner of Fatburger, Johnny Rockets, Marble Slab Creamery and other restaurant chains has entered into a deal to acquire Fazoli’s from Sentinel Capital Partners for $130 million. It’s the global restaurant franchising company’s fourth acquisition in a year, and follows its $300 million purchase of Twin Peaks https://chainstoreage.com/johnny-rockets-parent-company-acquire-twin-peaks-restaurant-chain-300-million in September.

Founded in 1988, Fazoli's owns and operates nearly 220 restaurants in 28 states and has a development pipeline of 100 units during the next several years. It is the largest premium quick-service Italian chain in America, according to Fat Brands. The transaction is expected to close by mid-December 2021.

“We have had an outstanding year and we couldn’t be more pleased to join forces with Fat Brands, a company that has the same growth-oriented mentality as us at Fazoli’s,” said Carl Howard, CEO of Fazoli’s. “From co-branding to virtual kitchens to menu development opportunities, we see great value in being a part of Fat Brands.”

The purchase of Fazoli’s will increase Fat Brands’ footprint to 2,300 franchised and corporate-owned stores around the world, bringing 2022 expected systemwide sales to more than $2.1 billion. The addition of Fazoli’s, including the new stores due to open and under development, is expected to increase the company’s post-COVID normalized EBITDA by approximately $14.5 to $15 million in 2022.

“Fazoli’s has a great growth story, in particular, over the last year. They continue to surpass sales expectations across the board,” said Fat Brands CEO Andy Wiederhorn. “We have been eyeing this category for some time; however, we were waiting for the right brand – one that is high-growth, with almost all restaurants having drive-thru access, in addition to, the synergies that we will achieve adding Fazoli’s to our portfolio of brands.”

Fat Brands acquired Johnny Rockets in September of 2020, Global Franchise Group  (Round Table Pizza, Great American Cookies, Hot Dog on a Stick, Marble Slab Creamery and Pretzelmaker) in July 2021 and, most recently, Twin Peaks in September 2021.