El Pollo Loco Holdings Inc. registered Tuesday for an initial public offering with the goal of raising $100 million to pay off debt.
In filings with the Securities and Exchange Commission, the Costa Mesa, Calif.-based operator did not indicate the number of shares to be offered or the price range.
The company is applying to list its common stock on the Nasdaq Global Select Market under the ticker symbol “LOCO.”
In SEC filings, the company said it has recorded 11 consecutive quarters of positive same-store sales growth through the March 26-ended first quarter. Average unit volumes have grown from $1.5 million in 2011 to $1.8 million in 2013, and total revenue increased 15 percent, to $314.7 million.
El Pollo Loco reported net income of $5.5 million during the quarter, compared with a net loss of $60,000 the previous year year, according to the filing.
From 2011 to 2013, the company’s net loss fell from $32.5 million to $16.9 million, including expenses for early extinguishment of debt.
The 401-unit chain has been working to rebrand itself over the past two years, shifting its quick-service chicken concept to more of a “QSR plus” positioning that leans towards fast casual.
El Pollo Loco began as a roadside chicken stand in Guasave, Mexico, in 1975, known for its citrus-marinated grilled chicken. In 1980, the concept arrived in Los Angeles and grew in popularity as an alternative to fried chicken.
Private equity firm Trimaran Capital Partners acquired a controlling interest in El Pollo Loco in 2005 for $415 million. The following year, the firm announced plans for an IPO, but that plan was later withdrawn due to unfavorable market conditions.
In 2007, private equity firm Freeman Spogli & Co. invested $45 million for an undisclosed stake in El Pollo Loco Inc. to help accelerate expansion.
El Pollo Loco, however, suffered during the recession, especially in its core market of Southern California, where unemployment rates were high. But in 2012, a debt refinancing paved the way for El Pollo Loco to launch what it called a “year of transformation.”
A new “Hacienda” prototype was developed, with an open-kitchen design that allowed guests to see “Grill Masters” at work. The menu was reworked to include more contemporary and healthful items, though the heart of the menu remained focused on its grilled chicken.
By the end of 2014, about half of the U.S. system will include the new Hacienda design, which has demonstrated a sales lift of about 3 percent, compared with locations that have not been remodeled. The company said the new design will be completed systemwide by the end of 2018.
While El Pollo Loco restaurants operate only in California, Nevada, Arizona, Texas and Utah, the brand is well positioned to benefit from the expected growth of the Hispanic population across the U.S., a move that has contributed to increased acceptance of Mexican cuisine, the filing said.
El Pollo Loco will join a growing number of restaurant companies going public this year.
In May, Papa Murphy’s Holdings Inc. made its debut on the Nasdaq. Zoe’s Kitchen Inc. held an IPO in April. And earlier this year, Salt Lake City-based Café Rio Inc. was rumored to be planning an IPO, according to The Wall Street Journal.
Jefferies LLC, Morgan Stanley & Co. LLC and Robert W. Baird & Co. Inc. are acting as joint book-running managers for El Pollo Loco’s proposed IPO. William Blair & Company LLC and Stifel are acting as co-managers.
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