Canadian franchisor and quick service restaurant operator MTY Food Group has signed a definitive combination agreement with Imvescor Restaurant Group, which owns franchised and corporate stores throughout Canada, for approximately $248m.

As per the agreement, MTY will acquire all the outstanding Imvescor shares. The deal offers Imvescor shareholders an aggregate consideration of approximately 20% in cash and approximately 80% in MTY common shares.

The deal will bring together MTY banners such as America’s Taco Shop, Thai Express, Vanellis and Manchu Wok with Imvescor’s Baton Rouge, Pizza Delight Scores and Ben & Florentine restaurants.

The combination will create a portfolio of over 5,700 stores under 75 brands and approximately $2.9bn in system sales received from restaurant guests at both corporate and franchise restaurants including take-out and delivery customer orders.

MTY chairman of the board of directors, president and CEO Stanley Ma said: “The combination of the two companies’ portfolios and expertise will produce tremendous opportunities for North American growth.”

Imvescor chairman of the board of directors François-Xavier Seigneur said: “The board of directors is unanimous in its recommendation that this transaction is in the best interests of all shareholders. We reached this conclusion following a detailed review and rigorous process that explored the strategic alternatives available to us. We urge shareholders to join us as owners of a stronger, more diversified company with an established track record of value creation and an exciting future ahead.”

The transaction is expected to complete in the first half of 2018 following the receipt of regulatory and Imvescor shareholder approvals and satisfying customary closing conditions.