Collins Foods’ wholly owned Dutch subsidiary is to buy eight KFC restaurants in the Netherlands.
The Collins Foods Netherlands Operations has entered a share purchase agreement with R. Sambo Holding.
This acquisition will boost Collins Foods’ KFC network in the Netherlands to 56 restaurants, which equates to 64 per cent of the market.
The eight additional restaurants will not count towards the target of up to 130 net new KFC restaurants by 2031 set by the franchisor’s Corporate Franchise Agreement.
In 2021 Collins Foods signed an initial five-year term agreement with KFC franchisor Yum! Brands to takeover the brand in the Netherlands. The franchisee then purchased nine KFC restaurants.
Collins Foods’ Netherlands acquisition boosts European growth strategy
Collins Foods’ managing director and CEO Drew O’Malley said the acquisition is another step forward for its 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’ existing debt facilities will fund the purchase which has been structured as an initial payment of approximately €8 million. An additional €4.6 million payments is dependent on the restaurants’ EBITDA over the next two years.
Completion of the purchase in May is subject to relevant government permits and the franchisor’s consent.
Collins Foods is a KFC and Taco Bell franchisee in Australia and a KFC franchisee in the Netherlands and Germany. It is also the franchisor for the Sizzler chain in Asia.
In September 2022 Collins Foods opened its 350th outlet, a KFC flagship restaurant in Brisbane.
The ASX-listed fast food operator reported half year results in November 2022. Overall revenue increased by 32 per cent in Europe with same store sales growth of 9.2 per cent in the Netherlands.
Source: Franchise Executives