Collins Foods Netherlands Operations, the fully owned Dutch subsidiary of Australia-based Collins Foods, has signed a share purchase agreement to acquire eight KFC restaurants in the Netherlands.
It will buy the restaurants from R Sambo Holding.
Following the completion of the deal, the KFC restaurant network in the Netherlands under Collins Foods will increase to 56.
The deal will also build on the Corporate Franchise Agreement (CFA) with the franchisor that covers KFC Netherlands by providing further scale and support to completely leverage Collins Foods’ operational capabilities and experience in the country.
However, the eight restaurants will not be added to the CFA’s target of up to 130 net new KFC restaurants by 2031.
Commenting on the deal, Collins Foods managing director and CEO Drew O’Malley said: “This acquisition is another step forward for Collins Foods’ European growth strategy. The eight restaurants we are acquiring in the Netherlands add another quality network of restaurants to our portfolio, as well as enhance our people capability as we continue to grow and increase our operational scale in the Netherlands.”
Collins Foods will fund the acquisition price under the share purchase agreement from its existing debt facilities.
The deal will see an initial payment of €8m, subject to certain adjustments for net debt and working capital, as well as an additional payment of up to €4.6m, which will be linked to two potential earn-out payments based on the EBITDA of the restaurant network over the next two years.
Closure of the acquisition is subject to several standard conditions being met, including securing all relevant government approvals for operating the restaurants, as well as approval from the franchisor.
Subject to the satisfaction of these conditions, completion of the transaction is expected to take place in or around May.
Last week, Tahir Group purchased eight KFC restaurants in London from the Barack Group of Companies.