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Fat Brands is focusing on building out its pipeline this year.

Fat Brands has (mostly) halted its brand purchasing spree

After acquiring 12 restaurant companies in three years, Fat Brands is slowing down to focus on building out the pipeline for its portfolio

After a whirlwind year of several high-profile acquisitions — including Global Franchise Group, Twin Peaks and Fazoli’s — Fatburger parent company Fat Brands is likely taking a shopping hiatus in 2022 to focus on building out both new and old brands in its portfolio, CEO Andy Wiederhorn said Tuesday during a presentation at the virtual ICR conference on Monday.

“We view 2022 as the year to digest the acquisitions we made in 2021,” Wiederhorn said. “We’re going to build out this organic pipeline (incremental earnings as opposed to buying another brand and accruing additional debt), grow our factory business, […] and continue to digest and integrate those acquisitions, make sure to focus on synergy and cross-sell the franchise development system across our base.”

Thus far, Fat Brands’ purchases have been a mixture of what the company calls “tuck-in acquisitions” (brands similar to brands it already owns and can easily be consolidated into the portfolio) and “stand-alone acquisitions” (brands that are unlike Fat Brands’ current offerings that have high growth yield potential, like Fazoli’s and Twin Peaks.

Wiederhorn said that besides assessing and dealing with the debt Fat Brands accrued from purchasing so many struggling and/or developing businesses, the company also has 100-125 stores in the pipeline that will be built in 2022 and will focus on building out its executive team.

But that does not mean Fat Brands is finished with fleshing out its portfolio:

“Never say never,” he said. “We have a. couple of acquisitions that we’re considering right now that are tuck-in deals. I think if the right opportunity comes along, we will absolutely make those incremental acquisitions. I just don’t think that we need another brand that needs to be grown or turned around.”

As Fat Brands focuses on real estate development and taking care of the debt the company acquired, the company might choose to off-load one or multiple brands in the future — in other words, buy now, ask questions (and sell) later, analyst Roger Lipton previously told Nation’s Restaurant News.

Overall, Fat Brands’ goal is to add 846 units across all four restaurant categories (quick-service, fast-casual, casual-dining and polished casual), with a particular focus on the fast-casual burger brands.

Contact Joanna at [email protected]

Find her on Twitter: @JoannaFantozzi

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