MTY in the globe
Globe says MTY Food chows down on Kahala Brands
2016-05-26 06:43 ET - In the News
The Globe and Mail reports in its Thursday edition that MTY Food Group ($42.25) has struck a friendly $400-million deal to acquire Arizona-based Kahala Brands and its 2,800 fast-food locations in 25 countries (all figures Canadian unless otherwise stated). The Globe's Richard Blackwell and Bertrand Marotte write that the latest cash and share purchase by MTY is by far its largest. The deal effectively doubles the size of the Montreal-based company. It also represents a major expansion into the United States market. MTY, which was essentially debt free, will have to borrow to complete the transaction, but investors still appeared thrilled by the expansion. MTY shares rose more than 18 per cent in Toronto on Wednesday. The Kahala family of brands -- which includes Cold Stone Creamery, TacoTime and Blimpie submarines -- will be added to MTY's 2,700 restaurants in Canada and 14 other countries. Among MTY's 40 banners are Cultures, Thai Express, Country Style and Jugo Juice. MTY posted more than $1-billion in sales last year, while Kahala sales are in the $950-million range. MTY has agreed to pay $240-million (U.S.) in cash plus about 2.25 million MTY shares, valued at about $95-million at Wednesday's close