Franchising

FAT Brands buying Nestle Toll House Cafe by Chip

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May 25, 2022

Los Angeles-based FAT Brands Inc., which owns Fatburger, Fazoli's and several other brands, has agreed to acquire the franchised chain of stores known as Nestle Toll House Cafe by Chip from Crest Foods Inc. and rebrand them as Great American Cookies. The acquisition is expected to increase FAT Brands' foothold as a leader in the dessert category within the cookie and ice cream spaces, joining its existing Great American Cookies and Marble Slab Creamery brands, according to a company press release.

FAT Brands became owner of Great American Cookies last year when it acquired its parent company, Global Franchise Group, in a $442.5 million deal with Serruya Private Equity Inc. and Lion Capital LLP. Round Table Pizza, Hot Dog on a Stick, Marble Slab Creamery and Pretzelmaker were also part of the deal.

Crest Foods franchises 85 Cafe by Chips, so the acquisition will add to FAT Brands' Atlanta-based manufacturing facility, providing supply chain efficiencies and cost-savings, as well as increasing the scale that will result from increased manufacturing volume, said FAT Brands CEO Andy Wiederhorn.

"In 2022 we are focused heavily on our deep organic growth pipeline, but we saw great value in making this accretive acquisition," he said in the release. "These stores will fold seamlessly into our Quick-Service Division and provide us the opportunity to increase the capacity of our manufacturing business, a key growth objective. To date, acquisitions have been a strong growth vehicle for FAT Brands, and we anticipate the combination of our production and distribution facility and scale to increase the profitability of the franchisees that are joining us in this acquisition."

The sale amount was not disclosed.

Fazoli's, a 220-unit Italian fast casual chain, was FAT Brand's latest purchase. The $130 million purchase was announced in November 2021.

FAT Brands owns Johnny Rockets, Buffalo's Cafe, Buffalo's Express, Hurricane Grill & Wings, Elevation Burger, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses.