Brinker International selling Chili's Restaurants

July 12, 2019 Comments Off on Brinker Will Buy 116 Chili’s Restaurants from Midwest Franchisee Views: 550 Midwest, National News

Brinker Will Buy 116 Chili’s Restaurants from Midwest Franchisee

Brinker International said it had executed a letter of intent to acquire 116 Chili’s Grill & Bar restaurants from its 14-year franchisee, Louisville, KY-based ERJ Dining. Deal terms weren’t disclosed.

The restaurants, primarily located in the Midwest, generate approximately $300 million of annualized revenue. The transaction is expected to close in the first quarter of Brinker’s fiscal year 2020.

The acquisition is expected to be accretive to earnings per share and generate incremental free cash flow in FY 2020. Brinker intends to fund the purchase price from its existing credit facility, and expects its adjusted leverage ratios to rise slightly.

“This acquisition is a compelling opportunity to further invest in our brand, broaden our scale and create growth in earnings and cash flow,” said Joe Taylor, CFO of Brinker. He added that Brinker sees “these well-established restaurants as a solid foundation for further growth in these markets.”

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