Dive Brief:
- &pizza has acquired Tijuana Flats, a fast casual Tex-Mex chain with 95 units, the company said Thursday in an emailed press release. The acquisition includes the chain’s headquarters in Maitland, Florida. Terms and purchase price were not disclosed.
- Alongside the deal, &pizza launched Latitude Food Group, a holding company that will oversee and guide both the pizza chain and Tex-Mex chain and “unite fast-casual and quick-service concepts that share a bold, unconventional spirit.”
- Latitude Food Group will help the chains grow through multi-unit franchising and partnering with entrepreneurs with multi-brand portfolios. Mike Burns, current &pizza CEO, will become CEO of Latitude.
Both restaurant brands are in the midst of a variety of different initiatives. &pizza launched franchising earlier this year and recently announced four new franchise agreements that will bring the chain beyond the mid-Atlantic and into markets like Orlando, Florida; Atlanta; Charleston, South Carolina; and Raleigh, North Carolina. Tijuana Flats emerged from bankruptcy earlier this year and has been undergoing store refreshes and a menu update that includes adding Street Tacos to its permanent menu.
“From their innovative use of technology and bold design to their shared commitment to community and purpose, the alignment is clear,” Burns said. “We’re excited to harness the unique strengths of both brands and apply proven strategies and efficiencies to build a strong foundation for future growth.”
The two brands don’t have much overlap in existing markets, which could provide opportunities for each to grow into new markets where Latitude will be able to support that growth. &pizza has locations across New Jersey, Pennsylvania, Washington D.C., Maryland and Virginia, while Tijuana Flats has a stronghold in Florida, and a presence in Alabama, North Carolina, Kentucky and Tennessee.
“We felt like we can take a lot of the operational and marketing models that we ran at &pizza in the last few years I’ve been here and just replicate that playbook,” Burns said.
Tijuana Flats also cleaned up its portfolio during restructuring so there weren’t any surprises with the brand, Burns said.
The two brands now share HR, accounting and financing direction under Latitude Food Group and Burns said the companies will also benefit from a shared supply chain, especially since there are similar ingredients at both concepts.
The restaurant industry has been particularly active in mergers and acquisitions of late. Potbelly went private after its acquisition by c-store company RaceTrac, and Denny’s is going private next year after the completion of a buyout by a group of investors. Yum Brands is considering strategic alternatives for Pizza Hut, which could include a sale. Jack in the Box sold Del Taco to one of its franchisees, Yadav Enterprises. Sun Holdings bought Bar Louie out of bankruptcy as well.
