Dive Brief:
- Golden Gate Capital has sold Bob Evans Restaurants to 4x4 Capital, according to a Thursday press release. Terms of the transaction were not disclosed.
- The private equity firm bought Bob Evans Restaurants for $565 million in 2017 following Bob Evans Farms spin off of its restaurant division.
- Like many other casual chains, Bob Evans has struggled to grow units in recent years, declining from 522 units in 2017 to about 420 units in 18 states today.
Dive Insight:
4x4 Capital said it aims to “maximize [Bob Evans’] long-term growth potential” and emphasized its track record of growing companies in the food and beverage sector with a “value-creation playbook rooted in active ownership and close partnerships with leadership teams.”
Bob Evans will keep its current leadership, and CEO Mickey Mills will stay on in her current post. 4x4 Co-Founder and Partner Gustavo Assumpção will become executive board chair.
“We look forward to investing in and enhancing our operations, guest experience, and brand — with a continued focus on stability, partnership, and long-term value creation,” Mills said in a statement.
Golden Gate Capital reportedly considered selling the full-service chain in 2022, when it had a valuation of $600 million. However, investor appetites for restaurant brands cooled that year. It allegedly considered a sale again in 2024, but the process took more than a full year to complete. Golden Gate Capital’s sale is not necessarily reflective of the chain’s struggles as private equity firms typically sell assets after around five years. Golden Gate has held Bob Evans for much longer.
Bob Evans has been working on boosting guest engagement, partnering with PAR Technology to deploy its loyalty platform PAR Punchh in 2024. The chain added personalized offers and rewards to its app, including family deals, value offers and online takeout options. The restaurant planned to use PAR Punchh’s AI-driven loyalty platform to improve customers’ lifetime value with personalized marketing.
4x4 Capital currently invests in FitCrunch, a protein snack business, and Yelloh — formerly known as Schwan’s Home Delivery — a consumer facing frozen food delivery service. 4x4 Capital focuses on middle market companies in consumer goods, services and agencies sectors in North America, according to the press release.
Transaction activity in the full-service dining segment has heated up in recent months. Denny’s was sold to a group of investors late last year. California Pizza Kitchen sold itself to a group of companies, including Consortium Brand Partners, Eldridge Industries, Aurify Brands and Convive Brands in December. Hooter’s, Bravo and Brio Restaurants and Bar Louie gained new owners after undergoing Chapter 11 last year.
