NPC International Inc. plans to expand its Wendy’s holdings with the agreement to buy 62 burger restaurants from Valenti Mid-Atlantic Management LLC, the company said Thursday.
Overland Park, Kan.-based NPC, which also is Pizza Hut’s largest franchise group, said it would pay $52.6 million plus additional working capital. NPC also agreed to acquire the property at six locations from Valenti Mid-Atlantic Realty for $3.6 million.
The Wendy’s units are in south-central Pennsylvania in the Harrisburg and Allentown markets. Valenti also franchises Chili’s Grill & Bar units from Brinker International Inc. The Wendy’s deal is expected to close in late April.
As part of the transaction, NPC said it plans to remodel certain acquired restaurants in Wendy’s new “Image Activation” format. The restaurants will be owned and operated by NPC's subsidiary, NPC Quality Burgers Inc.
Jim Schwartz, NPC CEO and chairman, said in a statement: “We are excited to further our growth in the Wendy’s system with the acquisition of this unique market in the mid-Atlantic.”
Schwartz added that the acquisition “is a natural extension of our holdings in North Carolina.”
NPC has acquired Wendy’s in six other separate transactions since 2013. With these additions, Schwartz said the company will own 246 restaurants and expects the annual revenue to exceed $350 million, which is about 30 percent of the NPC’s consolidated revenue.
NPC said it will pay for this Wendy’s acquisition primarily with available cash on hand and borrowings from its $110 million revolving line of credit.
The Wendy’s units in the deal generated about $93 million in net product sales during the 52 weeks ended Dec. 25, NPC said.
NPC International currently franchises and operates 1,152 Pizza Hut restaurants and delivery units in 27 states and 184 Wendy’s units in five states.
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