Tacos, pizza and now, burgers!
One of the world's largest fast-food restaurant companies, Yum! Brands Inc., just got even bigger.
The owner of fast-food favorites like Taco Bell, Pizza Hut, and KFC has acquired Habit Restaurants Inc. in a $375 million deal.
Through the agreement with the Irvine, California company, Yum! has acquired 300 locations across 13 states and internationally to expand its offerings to sell chargrilled burgers, ahi tuna sandwiches, and milkshakes.
“We’ve emerged from our three-year transformation stronger and in a better position to accelerate the growth of our brands and leverage our scale to unlock value from strategic acquisition,” Yum! Chief Executive Officer David Gibbs said in the memo obtained by Bloomberg. “As a fast-casual concept with strong unit economics, The Habit Burger Grill is a fantastic addition to the Yum! family and has significant untapped growth potential in the U.S. and internationally.”
Yum! will now represent a “fast-casual” style of dining allowing them to compete with fast-food giants like McDonald’s, Burger King, but also more expensive chains such as Shake Shack and Five Guys.
It will also allow for expanded business and potential franchising opportunities in the Asian market in countries like China and Cambodia.
“There seems to be a lot of appeal of the concept in Asia,” Yum CEO David Gibbs Gibbs said in an interview on Bloomberg.
“China is a good opportunity. They already have a good start there.”
Yum! will finance the deal with cash and available credit, and is expected to close the deal near the end of the second quarter.