ASX-listed Collins Foods will spend $110.2 million to acquire 28 KFC restaurants around Australia from US-based Yum! Brands, six of which are in Western Australia.
Collins announced today it would acquire 28 KFC restaurants in Tasmania, South Australia and WA, and would use $69.3 million in debt facilities and undertake a $44.1 million capital raising to fund the acquisitions.
The deal includes the acquisition of six restaurants in WA, which will boost the number of KFC stores in the state to 47.
Two of the WA restaurants are currently under construction and are due to open by the end of the year.
“This acquisition provides an exciting opportunity for us to continue to grow in WA and develop new growth platforms in Tasmania and South Australia,” Collins managing director Graham Maxwell said.
In today’s announcement, Collins also revealed plans to close one of its KFC stores in WA, which it said was running at a loss.
The acquisition was announced on the same day Collins revealed a 10.3 per cent increase in revenue for FY17 to $633.6 million, with statutory net profit down 3.9 per cent to $28 million.
The group’s KFC business in Australia increased sales by 0.7 per cent.
Shares in Collins were unchanged at $5.17 each at the close of trade.