NEW YORK Private-equity firm Sentinel Capital Partners closed last month on the purchase of 123 Pizza Hut restaurants in Southern California from brand franchisor Pizza Hut Inc., a subsidiary of Yum! Brands Inc., the company said. Terms of the deal were not disclosed.
Sentinel, which previously held restaurant investments in Taco Bell and Church’s Chicken franchisees as well as Ryan’s Steakhouse and Old Country Buffet parent Buffets Inc., completed the Pizza Hut acquisition through its newly formed Southern California Pizza Co. The deal included real estate assets for many of the locations, Sentinel said in a statement.
Debt financing, including a $29.3 million senior secured credit facility, was arranged by CIT Group Inc. The facility consists of a term loan and a revolving credit facility, CIT said.
The Pizza Hut restaurants are located in Los Angeles, Riverside, San Bernardino and Orange County, Calif. Southern California Pizza is now the largest Pizza Hut franchisee in California, Sentinel said, and is among the 10 largest franchisees in Pizza Hut’s 7,515-unit system. Sentinel recruited Jerry Ardizzone, an industry veteran with 19 years of experience in the Pizza Hut system and roles within the Arby’s chain, to be Southern California Pizza’s chief executive.
Yum Brands has undertaken a refranchising initiative to sell corporate-owned restaurants to franchisees. The company has said it wants corporate restaurants to make up 10 percent of its U.S. system by 2010, down from about 20 percent currently.
