Great to see that GJC is going into very capable hands. RFG will do a great job for Gloria Jean’s Coffees. There is opportunity to leverage the brand and roasting across the newly acquired Cafe2U and other coffee assets as well as other outlets.
Synergies would be extensive as is the opportunity to create value through measured expansion. The International potential is enormous if handled well through the right partners. A great deal for all parties!
Below is the announcement article from News.com.au
THE company behind Michel’s Patisserie and Donut King has bought Gloria Jean’s Coffees for $163.5 million.
Retail Food Group said the global coffee chain had long been a target for the company, and adds to its current coffee businesses, Cafe2U and The Coffee Guy. Gloria Jean’s has 358 stores in Australia, 87 in the United States and franchises in 40 other countries.
Retail Food Group will pay $153.5 million in cash plus $10 million in its own shares, plus up to a further $16.4 million depending on the company’s performance.
The executive chairman of Gloria Jean’s, Nabi Saleh, has promised to stay with the business for at least another two years, along with his senior management team. He said Retail Food Group’s reputation as a food and beverage operator and expertise in building franchise businesses made them ideal to lead the continued expansion of Gloria Jean’s.
Gloria Jean’s was established in Chicago in 1979, and under the ownership of Mr Saleh expanded to Australia in 1996.
Retail Food Group is buying the intellectual property rights to the Gloria Jean’s and It’s a Grind brands, and will be the operational manager of the business in Australia and the US. It will also take ownership of its wholesale coffee roasting operations in Australia and the US, and will be the franchisor of the business in 40 countries.
Retail Food Group will raise $55 million to help fund its purchase through the issue of new shares to institutional and sophisticated shareholders. The company has also increased its senior debt facility with National Australia Bank, from $135 million to $253 million.
Its purchase of Gloria Jeans is expected to be settled by December.