Blackstone has entered a definitive agreement to acquire Tropical Smoothie Cafe, a franchisor of fast-casual restaurants, from Levine Leichtman Capital Partners.

Financial details of the deal have not been disclosed by the companies, but it could be valued at around $2bn, according to The Wall Street Journal.

This is the first deal completed under Blackstone’s flagship private equity entity, and the company intends to keep expanding Tropical Smoothie Cafe by making investments in operations, marketing, and menu innovation.

Blackstone’s Private Equity business senior managing director Peter Wallace said: “Tropical Smoothie Cafe has had an impressive growth trajectory consistently building on its loyal customer base as it has scaled nationwide.

“Blackstone has deep experience helping accelerate the expansion of leading franchise businesses as one of our highest-conviction investment areas.

“We believe our capital and resources will help position Tropical Smoothie Cafe for continued success and innovation for the benefit of its guests and franchisees.”

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Tropical Smoothie Cafe, which started as a single beachfront outlet in Destin, Florida, in 1997, has since grown into a brand with more than 1,400 outlets across 44 US states.

In 2023 alone, Tropical Smoothie Cafe opened more than 175 new locations. Notably, 70% of these new outlets were opened by existing franchisees.

Tropical Smoothie Cafe CEO Charles Watson said: “The key to this business is delivering an outstanding experience for each guest who walks through our doors.

“From high-quality products to exceptional guest service, our franchisees make our mission to become a beloved brand a reality day in and day out, and we are thrilled to see how the brand will continue to grow with Blackstone’s outstanding global resources behind it.”

For this deal, Barclays served as the financial adviser for Blackstone while Simpson Thacher & Bartlett provided legal counsel.

On the other side of the transaction, Baird led the financial advisory team for Tropical Smoothie Cafe, with North Point and BofA Securities offering additional support.

Kirkland & Ellis acted as legal counsel to Tropical Smoothie Cafe.