IHOP embarks on Middle East expansion

DineEquity Inc. is adding IHOP locations overseas in an aggressive push into nine countries in the Middle East, the company said Monday.

IHOP Franchise Company LLC has signed a franchise agreement with an affiliate of Kuwait-based M.H. Alshaya Co. WLL to develop 40 restaurants over the next five years in Kuwait, Saudi Arabia, Jordan, Lebanon, Qatar, the United Arab Emirates, Oman, Bahrain and Egypt.

The move marks IHOP’s first major expansion outside North America and represents the largest international development deal in the brand’s history, the company said.

“This agreement illustrates our commitment to grow our business by leveraging DineEquity’s valuable brands and expanding beyond the markets we have traditionally served,” Julia Stewart, DineEquity’s chair and chief executive, said in a statement. “We look forward to working with Alshaya to make IHOP, with its unmistakable offerings and excellent service, a destination choice throughout the Middle East.”

M.H. Alshaya is the franchise operator of more than 55 retail brands, including U.S.-based restaurants such as Starbucks, P.F. Chang’s China Bistro, The Cheesecake Factory, Pinkberry and Shake Shack.

The Middle East has become a hotspot for American brands. U.S.-based restaurant companies that have announced plans to open in the region this year include Quiznos, Elevation Burger, Top That! Pizza, Chili’s Grill & Bar, Fatburger, Ponderosa and Dixie Cream Donut Co.

IHOP’s 1,513 locations are in the United States, Canada and Mexico, but in recent months the chain has pushed into Puerto Rico, the U.S. Virgin Islands and Guatemala. DineEquity is planning to open between 55 and 65 new IHOP locations in 2011, mostly in the United States.

“The Alshaya agreement marks a major milestone in IHOP’s international development strategy and reflects our commitment to make the brand accessible to more guests,” Jean Birch, IHOP’s president, said in a statement. “IHOP is an icon in the industry, and we are proud to partner with one of the premier franchisees of international brands in the Middle East to deliver our delicious food and warm service to an entirely new set of guests and their families.”

IHOP has also been pushing domestic franchise growth with the development of express variants of the brand for non-traditional locations such as college campuses, military bases and airports.

In May, the chain launched a line of branded frozen breakfast foods called IHOP at Home, which are available in Walmart stores.

Glendale, Calif.-based DineEquity, also operates and franchises the 2,011-unit Applebee’s brand. Franchisees are expected to open between 24 and 28 Applebee’s locations this year, about half of which will be in international locations.

Contact Lisa Jennings at [email protected] [3].
Follow her on Twitter: @livetodineout [4]