NPC announced today that it has entered into an agreement with Valenti Mid-Atlantic Management, LLC (Valenti) to acquire 62 Wendy’s restaurants for $52.6 million, plus amounts for working capital. NPC also agreed to acquire six fee property locations from Valenti Mid-Atlantic Realty for $3.6 million. As part of the transaction, NPC plans to remodel certain acquired restaurants in Wendy’s new Image Activation format.
This acquisition is expected to be funded primarily with available cash on hand and borrowings on NPC’s $110 million revolver. The restaurants will be owned and operated by NPC’s wholly-owned subsidiary, NPC Quality Burgers, Inc., which entered into the asset purchase agreement to acquire the restaurants.
The units to be acquired are located in south central Pennsylvania in and around Harrisburg and Allentown, Pennsylvania. According to information provided to NPC, the restaurants generated approximately $93 million in net product sales during the 52 weeks ended December 25, 2016. NPC expects the closing to occur in late April, subject to customary closing conditions, including the approval of The Wendy’s Company.
Jim Schwartz, Chairman and CEO of NPC International, Inc. said, “We are excited to further our growth in the Wendy’s system with the acquisition of this unique market in the mid-Atlantic. This market will leverage our existing Wendy’s infrastructure and is a natural extension of our holdings in North Carolina. This acquisition will be our seventh acquisition in the Wendy’s system since 2013 and will increase our holdings to 246 restaurants with expected annual revenues exceeding $350 million, or approximately 30% of our total consolidated revenues.”
NPC International, Inc. is the world’s largest Pizza Hut franchisee and currently operates 1,152 Pizza Hut restaurants and delivery units in 27 states and 184 Wendy’s units in 5 states.