Levine Leichtman Capital Partners has agreed to purchase fast-casual chain Tropical Smoothie Cafe, the Los Angeles-based private equity firm said Tuesday. Management, led by CEO Charles Watson, will remain the same.
“We are excited to partner with Charles and the rest of the management team who have led the tremendous growth of Tropical Smoothie Cafe. We look forward to working with them as they continue to increase system-wide sales, improve franchisee unit economics and expand unit count in the significant remaining whitespace,” LLCP managing partner Matthew Frankel said in the press release announcing the purchase, terms of which were not disclosed.
Atlanta-based Tropical Smoothie Cafe franchises more than 870 fast-casual restaurants in 44 states, and has continued to perform well during the novel coronavirus pandemic, having reported same-store sales growth of 25.5% in July.
The chain specializes in sandwiches and flatbreads as well as smoothies.
“My team and I are very excited to partner with LLCP as Tropical Smoothie Cafe seeks to enhance its market-leading position,” Watson said. “Having the opportunity to leverage LLCP's extensive franchise expertise will be pivotal in driving further growth and supporting franchisees in inspiring better in our guests."”
LLCP has previously invested in Bertucci’s, Cicis Pizza, Quiznos and Wetzel’s Pretzels, although Tropical Smoothie is its only current restaurant investment, according to its website.
LLCP was advised in the deal by Kirkland & Ellis LLP. Debt financing was provided by Golub Capital. Management was advised by Jamieson and Peter Klein, P.A. Tropical Smoothie Cafe was advised by Robert W. Baird & Co. and Alston & Bird LLP.
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