The Del Taco sign is displayed outside the Del Taco restaurant in Gardena, California.
Patrick T. Fallon | Bloomberg | Getty Images
The hamburger chain will pay $ 12.51 per share in cash for the acquisition. Del Taco shares closed at $ 7.53 per share on Friday. Jack in the Box will raise funds for the acquisition by issuing additional securitization notes.
“This is a natural combination of two like-minded and challenging brands with outstanding growth opportunities,” said Darin Harris, CEO of Jack in the Box, in a statement. “Together, Jack in the Box and Del Taco will benefit from a stronger financial model, gaining greater scale for investing in digital and technology capabilities, and growing units for both brands. I will do it. “
Jack in the Box shares fell more than 3% on Monday afternoon trading. Jack in the Box’s share price has fallen by more than 10% this year, reaching a market value of $ 1.76 billion. Del Taco’s share price surged more than 65% in the afternoon trading to $ 12.54 per share. Bringing its market value to over $ 450 million.
Del Taco has a footprint of about 600 restaurants across 16 states, making it the second largest Mexican fast food chain in terms of number of restaurants. Yum Brands Taco Bell. In the third quarter, adjusted revenue of $ 124.3 million earned 11 cents per share.
The merged company will have more than 2,800 locations in 25 states. The purchase will be completed in the first three months of 2022.
Jack-in-the-Box predicts that the transaction will increase earnings per share in the first year in the mid-single digits, excluding transaction costs. By the end of 2023, the company expects to generate approximately $ 15 million in profits from this transaction, including supply chain savings and knowledge sharing initiatives.
Jack in the Box buys Del Taco for $ 575 million
Source link Jack in the Box buys Del Taco for $ 575 million