Hargett Hunter Capital Management has taken a minority investment in the eight-unit Marugame Udon USA LLC and plans to expand the Japan-based brand, the company said Tuesday.
Raleigh, N.C.-based Hargett Hunter, which has invested in the Bella Green, ChopShop and Stacked, has invested in the U.S. arm of fast-casual Marugame Udon, which has more than 1,000 units worldwide, from Toridoll Holdings Co. Ltd. Terms were not disclosed.
Mark Brezinski will serve as president and chief strategic officer of Marugame Udon USA, and Pete Botonis has been named chief operations officer. Both worked together in the early devolopment of Pei Wei Asian Diner when it was a division of P.F. Chang's China Bistro.
Brezinski said Marugame Udon USA will move its operations base from Irvine, Calif., to Dallas. The division has two units in Hawaii and six in California, and the restaurants serve udon and tempura in a cafeteria-style service model with an open kitchen. Udon noodles are made in each of the units.
“I think Japanese is the new Chinese,” Brezinski said in a phone interview Tuesday, adding that the company will develop a prototype to go into a variety of locations. “We want to develop a prototype but we don’t want to be prototypical.”
Brezinski said Marugame, which is named for a city in Japan’s Kagawa Prefecture known for its udon noodles, can adapt to real estate ranging from 2,400 to 3,600 square feet. “We can work in an urban setting. We can work in a super suburban setting. And we can work in a suburban setting. It really depends on the deal,” Brezinski said.
“The menu will have to expand a little bit,“ he added. “You have to make some hard decisions about what has to come off in order to put something on.”
Marugame Udon units currently have 14 to 16 tempura items and eight to 12 bowls. Brezinski envisions expanding the menu into Japanese katsu sandwiches and robata grilled items, which means some tempura and vegetable items may be removed.
A condiment bar allows for customization with toppings, but Brezinski said the new owners plan to “bring a little more structure” to that offering and some of that may shift to the serving line.
Brezinski said he thinks the average check will end up being between $11 and $14 per person.
Jeff Brock, the managing partner of Hargett Hunter, said Marugame is an exciting growth concept. “It’s not often you get to help build the clear leader in a category, and with over 1,000 udon shops across Asia alone, Marugame is just that,” Brock said in a statement.
Marugame is the first investment in Hargett Hunter’s recently launched Premier Brands Fund I. Hargett Hunter’s other investments include majority stakes in ChopShop, Stacked and Bellagreen.
Takaya Awata, founder and CEO of Toridoll Holdings Corp., said the partnership will help grow the Marugame Udon concept. Toridoll has $1.4 billion in sales at 1,700 restaurants worldwide. Toridoll has more than 800 Marugame Udon locations in Japan and more than 200 stores in 13 other countries.
McGuireWoods LLP provided legal counsel to Hargett Hunter. BDO USA LLP provided financial and accounting diligence to Hargett Hunter.
Contact Ron Ruggless at [email protected]
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