Fat Brands (NASDAQ:FAT) is in the news Thursday after announcing an acquisition that has FAT stock soaring higher.
A Fat Brands news release reveals that the restaurant franchising company plans to acquire restaurant chain Johnny Rockets. This will have the company acquiring the chain from Sun Capital Partners for $25 million.
Fat Brands notes that it plans to fund the transaction with a mix of cash on hand and financing from its securitization facility. The deal is set to close in September of this year. It will push the company’s total restaurant count above 700 locations.
Andy Wiederhorn, president and CEO of Fat Brands, said the following about the news.
“Similar to Fatburger, Johnny Rockets got its start in Los Angeles, and we couldn’t be more pleased to add another true staple in our home city to our portfolio. This acquisition is a transformative event for FAT Brands in terms of scale and brand awareness. We see a lot of synergy with Johnny Rockets and our current restaurant concepts and we are eager to take the brand to new heights.”
The deal saw Duff & Phelps acting as the financial advisor to Sun Capital Partners with Morgan, Lewis & Bockius LLP serving as its legal advisor. Fat Brands got its tax advice from Andersen Tax LLC and legal advice from Loeb & Loeb LLP.
FAT stock was up 105.1% as of Thursday afternoon.
As of this writing, William White did not hold a position in any of the aforementioned securities.