Fashion retailer Fawaz Abdulaziz Alhokair & Co to acquire Saudi franchise rights for 10 international food and beverage brands
Fashion franchise retailer Fawaz Abdulaziz Alhokair & Co has announced that it will acquire the Saudi franchise rights for 10 international food and beverage brands from Food and Entertainment Company Ltd.
The deal will see an exchange of non-core receivables valued at SR340 million ($90.5 million) with the current operator, it said in a statement.
The company said the acquisition reinforces its vision to create a stronger “shoppertainment” experience with over 10 F&B brands and 200 locations in Saudi Arabia.
Growth will be focused on targeted quick service restaurant (QSR) businesses with high margins.
The primary brands of this portfolio which make up the bulk of locations within the acquisition consist of Seattle’s Best Coffee, Cinnabon, Mama Bunz, and Molten Chocolate Café.
The remaining brands cater to the casual dining sector. Among them include Crêpe Affaire, Life with Cacao, Turkish coffee chain Kahve Dünyasi, Caffe Concerto, the restaurants Azal and Bluefin, and Sütiş.
The franchise operations of the 10 food and beverage brands recorded an EBITDA value of SR54 million against revenue of SR354 million in 2019, the statement said.
“This exciting transaction marks our company’s successful expansion into the food and beverage sector. The acquisition gives us a Kingdom-wide portfolio of strong brands that cover a wide range of tastes and products and fast-growing challenger brands with significant growth potential,” said CEO Marwan Moukarzel.
“We are very excited about this first step, the future potential of F&B, and the value it will bring for our customers. We are going to build on this to create new experiential opportunities for our customers.”
Global F&B expert Peter King recently joined as CEO of Food for Innovation Union Company to help steer the operational transition to Fawaz Abdulaziz Alhokair & Co and streamline the integration of the two brand powerhouses.
King said: “Our expansion plan over the next 5 years is an ambitious approach to F&B in Saudi Arabia. The acquisition offers scalability and better access to resources, with all the benefits of being part of a public company.”
The agreement requires that Food & Entertainment Company Ltd will be liable to compensate Fawaz Abdulaziz Alhokair & Co if the financials of Innovative Union Company fall short of the established 2020 projections.
The completion of the transaction is subject to the completion of regulatory conditions and is expected by the end of 2019.For all the latest retail news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.