The Cheesecake Factory has entered into definitive agreements to acquire Fox Restaurant Concepts (FRC) and the remaining interest in North Italia.
The transactions will be completed for $308 million, with an additional $45 million due ratably over a four year period.
The Company had previously invested $88 million in the North Italia and Flower Child concepts over the last three years in anticipation of their purchase.
The Cheesecake Factory Incorporated’s Board of Directors has unanimously approved the transactions, which are expected to close around the end of the third quarter of fiscal 2019.
David Overton, the chairman and CEO of the cheesecake factory, said: “Since making our initial minority investments in North Italia and Flower Child in 2016, we have not only helped fuel the growth of both brands, but also developed a deep relationship with Sam Fox at Fox Restaurant Concepts.
“We realized the true potential of this relationship as we worked through the integration process for our planned acquisition of North Italia.
“It became evident that the combination of two of the most experiential and entrepreneurial restaurant companies could drive greater value as one organization.”
Overton said that the company had decided to bring together North Italia and Fox Restaurant Concepts, including Flower Child, with The Cheesecake Factory to reinforce its leadership position in experiential dining.
He added: “With the power of The Cheesecake Factory brand, infrastructure and growth potential, complemented by an additional growth vehicle in the North Italia concept and an incubation engine to develop concepts of the future, we believe we will be even better positioned to provide our guests with exceptional dining experiences, offer growth opportunities for our respective teams and maximize long-term value for our shareholders.”
Fox Restaurant Concepts founder and CEO, Sam Fox, said: “This partnership will be the first of its kind for the restaurant industry.
“David Overton and I quickly realized the magic occurring between our organizations while we worked through North Italia’s integration.
“With our aligned cultures and philosophies, The Cheesecake Factory is the right partner to embrace our creative spirit, enabling us to innovate concepts, while providing the infrastructure and capital to scale.”
Following the completion of the transactions, North Italia’s operations will be located at The Cheesecake Factory Incorporated’s corporate headquarters in Calabasas Hills, California to help scale the concept nationally.
FRC will operate as a wholly-owned subsidiary, and continue to be led by Sam Fox from its headquarters in Phoenix, Arizona.