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ARC outlines terms of planned Tilted Kilt deal

Acquisition would include debt assumption, stock issue

ARC Group Inc., parent to the casual-dining Dick’s Wings & Grill brand, has settled more financing details around its planned acquisition of Tilted Kilt Pub and Eatery from SDA Holdings LLC, the company said Tuesday.

The Jacksonville, Fla.-based ARC said the acquisition of Tempe, Ariz.-based Tilted Kilt would include a nominal $10 cash payment, the assumption of about $1.8 million in debt, future payments of $1.5 million and the issuance of about 1.4 million shares of stock, which are currently trading at about $1.40 a share.

ARC said it expected to close the deal, which was first announced in June, by the end of the year.

“The Tilted Kilt acquisition is in line with our strategy of targeting undervalued-underperforming restaurant chains with immediate cash flow potential,” Seenu G. Kasturi, ARC Group’s president and chief financial officer, said in a statement.

ARC said Tilted Kilt has 34 restaurants, plus another eight franchised units, in 17 states, generated about $14 million in revenue in 2017.

Richard Akam, CEO of ARC Group, continued, “Tilted Kilt will be a strong addition to our platform and a brand for which we believe we can make a significant impact in its top- and bottom-line growth.”

In August, ARC Group Inc. acquired the four-unit Fat Patty’s concept for $12.3 million.

ARC, formerly known as American Restaurant Concepts, also owns the 26-unit Dick’s Wings, which includes four company-owned restaurants, three company-owned concession stands and has 19 franchise locations.

Akam said that, between 2013 to 2017, ARC improved average unit volumes at Dick’s Wings from $699,000 to $966,000. 

“During this same period of time, we increased the number of Dick’s Wings units from 15 to 22 and systemwide sales from $10 million to $22 million,” Akam said, “We look forward to replicating this success with Tilted Kilt.”

Contact Ron Ruggless at [email protected]

Follow him on Twitter: @RonRuggless

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