Sagittarius Brands has put its Captain D's Seafood Kitchen brand up for sale, company spokeman Ronald Roberts confirmed today.
"Sagittarius Brands has made the strategic decision to put Captain D's (up) for sale," he said. "Captain D's is seen as a viable, well known and respected brand that will generate strong interest from many potential buyers."
Sagittarius Brands does not plan to sell its Mexican QSR chain Del Taco but focus exclusively on its expansion and brand development, said Mike Payne, Sagittarius Brands chief financial officer. "Sagittarius is focusing on growing the Del Taco brand and has no plans to acquire another chain in the near future," he said.
Captain D's, the No. 2 limited-service seafood brand behind Long John Silver's, captured media attention last year when it took on casual-dining seafood leader Red Lobster with a series of ads asking customers to compare the meals, with Red Lobster signage prominent in the background.
The "Sit down food at fast food prices" campaign was successful for the company, which improved its menu a few years ago. The menu additions included a selection of grilled seafood entrees and steamed vegetables. The company also is in the midst of a reimaging effort as the chain moves to position itself as more of a fast casual concept.
Earlier this month, Zimmerman Advertising announced that the chain chose the national retail brand-builder agency to handle the chain's core strategy, creative and retail activation for its restaurants.
Headquarted in Nashville, Tenn., the chain has more than 550 locations in 26 states, primarily in the Southeast. In early 2009, David Head was promoted to chairman and CEO of the chain after Sagittarius Brands chairman and CEO Nick Shepherd left to lead Carlson Restaurants Worldwide Inc.
Darren Tristano, executive vice president of foodservice industry consultants Technomic Inc., said Captain D's is an attractive brand, especially in light of their shift toward fast casual.
"Given the economy, their positioning in seafood, a healthier category when 'not fried', and the price points of fast food are also appealing," he said.
According to Technomic data, the chain's estimated annual unit volume is $870,000. The privately held company told QSRweb.com in March 2009 that their annual sales were about $500 million.
Value in seafood?
Michael Schaefer, an industry analyst with Euromonitor International, is more cautious in recommending the brand, particularly because of the limited potential for QSR seafood concepts to succeed as national brands. He sees greater potential in an innovative fast casual concept that focused on freshness and sustainability.
A fast casual concept that offered fresh or exotic seafood would catch consumer interest, but building the supply chain might be too big of a challenge to overcome, he said.
"But in terms of what you see from a Captain D's or a Long John Silver, that's going to be a much tougher sell," he said. "Even there, the only way forward is to really push things like quality and sustainability and something beyond fried fish."
Although Captain D's has made progress in updating its menu, its emphasis on fried fish is limiting, he said. "I'm just skeptical about the demand for this type of concept in terms of future growth because they're really only bringing so much new to the table here."
(Updated 1/15/10 with quote from Mike Payne, Sagittarius Brands CFO.)
