London-based private-equity firm Electra Partners is acquiring the 66-unit TGI Fridays division in the United Kingdom in a management-led buyout, the investment company said Tuesday.
Electra said it was investing £100 million, or about US$155.3 million, of equity in the deal, alongside Karen Forrester, chief executive of TGI Fridays U.K., and other members of management.
The deal, including debt, values the company at about £225 million, or US$395.9 million, a person with knowledge of the terms told the market website Fast FT. Debt facilities for the transaction were provided by ICG and Barclays, Electra Partners said.
TGI Fridays has undertaken a broad refranchising program since Minneapolis-based Carlson sold the Carrollton, Texas-based casual-dining company in July to U.S. private-equity firms Sentinel Capital Partners and TriArtisan Capital Partners for an undisclosed amount.
Forrester said in a statement: “In Electra Partners, we are delighted to have found a long-term partner capable of supporting our growth ambitions, as we look to further expand TGI Fridays’ share of the U.K. market.”
Electra Partners is a 25-year-old private-equity firm that invests in a variety of mid-market retail and other business sectors. The firm’s major client is Electra Private Equity PLC, a publicly traded investment trust.
Bill Priestley, partner at Electra Partners, said: “TGI Fridays is exactly what we look for in an investment — an attractive, differentiated business with an impressive financial track record and an excellent management team.
“We look forward to working with Karen Forrester and her team to develop the business further through a mixture of organic growth and new restaurant openings, while at the same time continuing to improve the existing sites,” Priestly added.
Fridays was a pioneer in taking U.S. casual-dining brands abroad, opening its first U.K. restaurant in 1986 in Birmingham.
U.K. partner Whitbread PLC sold the Fridays units back to the parent company in 2007. At the time, Carlson teamed up with London-based ABN Amro Capital to acquire the 45 restaurants then located across the U.K.
In 2010, Carlson acquired the remaining stake from the joint-venture partner.
Since being acquired by Sentinel and TriArtisan, TGI Fridays has been refranchising company-owned markets with the provision that new owners update units.
The 900-unit Fridays unveiled a new unit in Addison, Texas, in September that extended the contemporary motifs launched earlier this year in Nashville, Tenn., and Brooklyn, N.Y.
The first TGI Fridays restaurant opened in 1965 in New York City, and the chain said it had 2013 worldwide sales of of $2.7 billion.
In the most recent Nation’s Restaurant News Top 100 census of U.S. systemwide foodservice sales, TGI Fridays ranked No. 34, with $1.8 billion for fiscal 2013.
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