Deal is part of ongoing refranchising effort
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Jamba Inc., parent to the Jamba Juice chain, has sold nine units in California in a refranchising deal with existing franchisee Blended Star Norcal Inc., the company said Tuesday.
The deal is the latest in the company’s ongoing effort to move to a more asset-light model, with the goal of becoming 90-percent franchise operated.
“We are excited with our continued progress in our refranchising efforts, and are still fully on track to close Phase II of our accelerated refranchising initiative by year end, reaching our goal to move to a franchise-to-company-owned store ratio of 90 percent/10 percent,” said James White, chairman, president and CEO of Emeryville, Calif.-based Jamba Inc. “We are well positioned to reach our goal of generating between $60 million and $70 million of cumulative cash proceeds from refranchising in 2015.”
The company said six or seven refranchising transactions are expected before the end of the third quarter this year, with about 90 to 100 units to be sold, generating proceeds of between $22 million and $25 million.
Since the beginning of 2015, 34 company-operated units have been sold to franchisees, and the company announced the refranchising of another 100 locations in California to Vitaligent LLC, a deal expected to close by the end of the second quarter.
The smoothie chain ended fiscal 2014 with 862 Jamba Juice locations worldwide.
For the first quarter ended March 31, the company reported a wider net loss due largely to restructuring costs. Systemwide same-store sales rose 5 percent during the quarter, including 6 percent at company-owned units and 4.2 percent at franchised locations.
Contact Lisa Jennings at [email protected].
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