Souplantation and Sweet Tomatoes Acquired, Pie Five’s Redesign and the D-Gulls

Served up on today’s plate are some restaurant acquisitions, a redesign for Pie Five, Chipotle’s charitable effort and Captain D’s biggest fans. Send news items of interest to Modern Restaurant Management (MRM) magazine’s Executive Editor Barbara Castiglia at bcastiglia@modernrestaurantmanagement.com or modernrestaurantmanagement@gmail.com.

Souplantation and Sweet Tomatoes Acquired

Perpetual Capital Partners and CR3 Capital, an investment affiliate of CR3 Partners, acquired Garden Fresh Restaurants’ 97-unit soup, salad, and bakery restaurant chain. Based in San Diego, CA, the company operates under two brand names: Souplantation in Southern California and Sweet Tomatoes elsewhere. The acquisition follows the company’s resurgence out of bankruptcy earlier this year. CR3 Partners led the restructuring and has been managing the company for several months. 

“Souplantation and Sweet Tomatoes are uniquely positioned with an extremely loyal customer base and dedicated restaurant teams,” said Gene Baldwin, Garden Fresh Restaurants interim CEO and partner at CR3 Partners. “This creates new opportunities for all of our employees, guests and business partners as we move forward.”

The acquisition follows the company’s resurgence out of bankruptcy earlier this year. CR3 Partners led the restructuring and has been managing the company for several months. 

Perpetual Capital Partners is a private company that invests in, acquires, owns and operates middle market businesses. The firm is a long-term investor that employs a collaborative and proactive investment approach, providing capital, corporate and strategic resources to help companies create value and achieve long-term sustainable growth. CR3 Capital, LLC is an operationally-focused private equity firm that invests in North American middle market companies. 

Terms of the deal were not disclosed.

J. Alexander’s to Acquire 99 Restaurants

J. Alexander’s, Fidelity Newport Holdings LLC and Fidelity National Financial Ventures LLC,  a direct wholly-owned subsidiary of FNF, entered into a definitive agreement under which J. Alexander’s will acquire 99 Restaurants, LLC in an all-stock transaction valued at approximately $199 million, including the assumption of $20 million in net debt. The transaction was approved by the board of directors of J. Alexander’s and the board of managers at FNH and is expected to close in the fourth quarter of 2017. FNH is a majority-owned subsidiary of FNFV.

“Ninety Nine Restaurant & Pub is a well operated concept,” said Lonnie J. Stout II, President and Chief Executive Officer of J. Alexander’s. “Founded in 1952, they are a strong regional competitor in the New England market with 106 restaurants currently in operation. They have a culture very similar to ours in that they are committed to outstanding guest service and putting employees first. Led by President Charlie Noyes, Ninety Nine has a tenured and deep management team. The team has weathered the casual dining headwinds very well and has posted same store sales growth over the last few years that has outperformed the market. They have a regional menu supported by a strong value proposition with a heavy concentration of restaurants in Massachusetts and the other New England states. This creates somewhat of a moat around the business. Another appealing characteristic is there is a solid business at Ninety Nine. It is a well-managed company. For all these reasons, we believe the Ninety Nine Restaurant & Pub group will be a perfect fit with our management philosophy at J. Alexander’s.”

Stout continued, “Since we were spun out of Fidelity National Financial, Inc. in September of 2015, we have considered various strategic options to growing our business. We believe the acquisition of the Ninety Nine Restaurant & Pub group will help us with scaling our business. During 2016, Charlie and his team generated over $300 million in total net revenue and approximately $30 million of Adjusted EBITDA with an average check per guest, including alcoholic beverages, of $15.82. We believe this transaction will be significantly accretive to our earnings in 2018. We believe this additional scale and liquidity will benefit all of our existing shareholders. Our Board has been narrowly focused on creating shareholder value. We believe the Ninety Nine acquisition is a key step in that direction.”

The J. Alexander’s senior leadership team will continue to manage the combined company following the closing of the transaction. In connection with the transaction, William P. Foley, II is expected to join the J. Alexander’s board of directors. There are no other expected changes to the J. Alexander’s board of directors or its executive officers in connection with the transaction.

Stephens Inc. has provided a fairness opinion. Bass, Berry & Sims PLC is serving as legal advisor to J. Alexander’s, and Weil, Gotshal & Manges LLP is serving as legal advisor to FNFV.

Chipotle Donating to Maryland SPCA

To help feed homeless pets at the Maryland SPCA and hungry pets in Maryland, Chipotle Mexican Grill will donate 50 percent of proceeds to the non-profit organization on qualifying purchases made on Thursday, August 10  at all 81 Chipotle restaurants in Maryland.

“The summer months are always our busiest time at the shelter – placing a significant strain on our resources,” said Jim Peirce, executive director of the Maryland SPCA. “This amazing opportunity with Chipotle Mexican Grill can help us replenish our supplies and continue to feed hungry pets in our shelter and across our community. When you eat at Chipotle on August 10th, you are feeding a hungry pet.”

In order for the MD SPCA to receive 50 percent of every purchase, restaurant patrons must:

• Notify the cashier, before paying for order, that they are there to support the Maryland SPCA. If the cashier isn’t notified, the MD will not receive credit for the purchase.
• Choose the pay-in-store option when ordering online and inform the cashier, prior to paying, that they are there to support the Maryland SPCA.
• Purchases made with a customers’ existing gift cards will count as long as they mention to the cashier, prior to presenting gift card, that they are there to support the Maryland SPCA. Any gift cards purchased during the fundraiser will not count toward donated sales.

“This fundraiser is so important because the Maryland SPCA relies on community support and fundraisers like Maryland SPCA Day at Chipotle to care for and feed hungry pets. Many people think that we are associated with the ASPCA – but that is not the case. We don’t receive any funding from the ASPCA,” added Peirce.

Last year, thanks to the community’s support, the MD SPCA was able to care for more than 3,500 dogs and cats and provided an additional 18.4 tons of food to feed hungry pets in needy homes throughout the state.

For more information about the Chipotle fundraiser for the MD SPCA, including restaurant locations, visit www.mdspca.org.

Pie Five’s New Design

Pie Five Pizza Co. fans who step into the company’s newest location at 8315 Preston Rd. in Plano will notice the brand’s updated contemporary logo and new restaurant design.

“After doing a significant amount of research, we recognized a shift in consumer behavior that provided an opportunity to make some exciting enhancements to our brand,” said Scott Crane, CEO of Pie Five parent company Rave Restaurant Group, Inc. “We approached the process of concept refinement, as well as our new test prototype design, in keeping with our passion for elevating the guest experience. Our team is excited to share this next-generation Pie Five with our guests.” 

Pie Five’s fast casual concept provides guests with a fully customizable experience from start to finish. 

The fast casual also launched all-new customizable mobile app on July 25. Pie Five’s mobile app was developed by Punchh, a cloud-based technology platform that builds engagement, loyalty and superior, customized experiences for the restaurant industry. 

“We understand the importance of modernizing and simplifying our guests’ experiences, which is why we spent a great deal of time developing and enhancing our new app,” said Kimberly Turman, Digital Marketing Manager for Pie Five. “With this technology, we will be able to offer a sophisticated, meaningful experience to our guests and really know who they are, which will help us distinguish ourselves within our competitive space.”

Captain D’s Introduces the D-Gulls

Captain D’s introduced its biggest fans—the D-Gulls, Dave & Desmond. The mascot introduction coincides with the announcement of Captain D’s $4.99 Full Meal Deals.

“Who knows seafood better than a pair of seagulls that hail from the coast?” says Bob Kraut, Captain D’s CMO. “Of course, our guests love our food just as much and appreciate our relaxing, seaside dining atmosphere where we bring a taste of the coast to every table. We believe everyone should be able to enjoy great seafood … except for the D-Gulls. Don’t feed the D-Gulls.”

Nearly 60 percent of all restaurants have been reimaged to the brand’s new coastal design with another 50 locations to be remodeled by the end of this year. With 521 restaurants in 21 states, Captain D’s is the number one seafood franchise in America ranked by average unit volume. The company is currently seeking single- and multi-unit operators to join in the brand’s expansion.