OVERLAND PARK Kan. NPC International Inc., the largest Pizza Hut franchisee, said this week it has agreed to purchase another 51 Pizza Hut restaurants from franchisor Pizza Hut Inc. for $14.4 million.
The franchisee, which operates 1,098 Pizza Hut units, or 18 percent of the entire domestic Pizza Hut system, had closed late last year on two additional deals, one in November and another in December, with the franchisor to increase its store base and consolidate its operations to the Midwest and Southeast. Pizza Hut is a division of Louisville, Ky.-based Yum! Brands Inc.
The latest units marked for sale are located in and around St. Louis and include 27 delivery or carryout units and 24 dine-in restaurants. NPC said that 49 of the 51 restaurants together generated sales of $40.1 million for the year ended in September. The remaining two locations were newly opened.
NPC said it will fund the purchase through borrowings from its $75 million credit facility. It expects the transaction to close next month.
For the nine months ended Sept. 23, NPC reported net income of $7.3 million on sales of $564.2 million, compared with earnings of $5.6 million on sales of $518.3 million a year-earlier.