Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


BurgerFuel gets $5.9M injection from new US investor

BurgerFuel gets $5.9 mln injection from new US investor to fund global expansion

By Paul McBeth

Jan. 14 (BusinessDesk) - Burger Fuel Worldwide, the NZAX-listed fast food chain franchisor, will raise $5.9 million from a new US investor, Franchise Brands, to help fund its global growth aspirations, including plans to reach into the world’s biggest economy.

Milford, Connecticut-based Franchise Brands will buy a 10 percent stake at $1.35 apiece with an option to lift its holding to 50 percent over eight years, and will support the New Zealand firm’s growth plans, including in the US where BurgerFuel plans to open restaurants, the company said in a statement.

The initial stake will be made up of a $5.9 million placement of new shares, and the purchase of $2.16 million of shares from controlling shareholder Mason Roberts Holdings. Once it’s completed, BurgerFuel will have cash reserves of between $9 million and $10 million and no debt, it said.

Franchise Brands was founded in 2005 to invest in small and mid-sized companies seeking to expand their businesses, and is backed by the founders of the Subway restaurant chain, Fred DeLuca and Peter Buck. Its investments include Mama DeLuca’s Pizza, Personal Training Institute, HomeVestors and Taco Del Mar.

The deal was at a 10 percent discount to the $1.50 price the stock was trading at before the announcement, and the shares have since gained 11 percent to $1.66. That values the company at $91.8 million. The shares were trading at the $1.35 trading price when discussions started in April last year.

“This gives us the opportunity to turbo charge our business by going into the US and other countries, alongside the largest franchise company in the world,” chief executive Josef Roberts said. “BurgerFuel will retain control over its unique brand and operating style and we will remain a publicly listed New Zealand company.”

In December, the company said it was scaling up the next phase of its global development and would spending financial year 2014 investing in latching on to those opportunities.

In recent years Burger Fuel has increased its exposure to the Middle East by signing master licensing agreements, which earns the company up-front territory fees and on-going royalties based on store turnover.

The deal needs shareholder approval, and the company said it would set a date for an extraordinary general meeting shortly.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Trade Plans: Prime Minister's Speech To International Business Forum

"The work to improve public services, build infrastructure, and solve social problems is possible only because we have enjoyed sustained, solid economic growth. A big reason for that is the Government’s consistent agenda of economic reform, and our determination to open up more opportunities for trade with the world." More>>

ALSO:

Media: TVNZ Flags Job Cuts To Arrest Profit Decline

Chief executive Kevin Kenrick said the changes were aimed at creating "a sustainable future video content business for TVNZ in an ever-changing media market." More>>

ALSO:

Reserve Bank: Wheeler Keeps OCR At 1.75%

Reserve Bank governor Graeme Wheeler kept the official cash rate unchanged at 1.75 percent, as expected, and reiterated his view that the benchmark rate doesn't need shifting for the foreseeable future. More>>

ALSO:

Retail: Pumpkin Patch Brand, IP Sold To Catch Group

The receivers of failed children's clothing retailer Pumpkin Patch have confirmed that the company's brand and intellectual property have been sold to Australian online retailer Catch Group. More>>

ALSO:

Oil: 2017 Block Offer Petroleum Tender Launched

New Zealand is well-placed to take advantage of the economic benefits of oil and gas exploration, Energy and Resources Minister Judith Collins announced today at the launch of the 2017 Block Offer petroleum tender. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news