Asian regional private equity firm Affinity Equity Partners has reportedly walked away from a preliminary offer to buy Australian fast-food franchise business Craveable Brands.
Craveable Brands is owned by another Asian regional buyout firm PAG Asia Capital.
Craveable Brands has more than 570 outlets and employs around 12,500 people.
The Australian Financial Review has reported that two people briefed on the discussions and speaking on condition of anonymity said Affinity had decided against negotiating further after completing due diligence.
Affinity reportedly made an indicative $800 million offer for Craveable Brands in October. This followed PAG seeking offers for the business saying it had received unsolicited approaches.
As owner of the Oporto and Red Rooster franchise chains and holding rights to West Australian franchise chain Chicken Treat, Craveable Brands was bought by PAG from Archer Capital in 2019 for an undisclosed sum believed to be in the range $450 million to $480 million.
Archer had bought the business, then Quick Service Restaurants, from Quadrant Private Equity for $450 million in June 2011.
In early 2023, Craveable Brands acquired fast-food business Charcoal Charlie’s for an undisclosed sum.
Charcoal Charlie’s was founded by the Sher family with a single outlet in Coogee in 1989 and by 2023 had grown to 17 Sydney outlets plus two more in Melbourne. Under Craveable Brands, four more outlets have been added to Charcoal Charlie’s.
While international brands such as McDonalds and Kentucky Fried Chicken (KFC in Australia) still dominate the fast-food sector in Australia, smaller locally developed businesses such as Charcoal Charlie’s and most notably Mexican themed Guzman Y Gomez (ASX: GYG) have taken a significant slice of the market in recent years.
Image: Charcoal Charlie’s now has 23 outlets in Sydney and Melbourne.