Longreach acquires Wendy's Japan

According to a statement, under Longreach ownership, Wendy's will use capital received from the deal to purchase 100% of First Kitchen. Financial details have not been disclosed. To date, equity commitments by the Japan and North Asia-focused buyout firm have ranged from $30-200 million.

First Kitchen, a subsidiary of Suntory Holdings, is a hamburger restaurant that benefits from a diversified menu including pizza, pasta and fried chicken. Longreach plans to grow the two chains together under the name Wendy's First Kitchen. This combination restaurant concept was first tested last year with two locations in Tokyo and was reported to be well received.

"This is an example of how we are bringing our 'narrow and deep' international strategy to life by initially focusing on four key markets - Japan, India, Brazil and the Middle East - where we see considerable upside potential over the next few years," Bob Wright, an executive vice president at Wendy's said in a separate disclosure. "We believe our best approach is to support our franchisees in building Wendy's brand strength in local markets and enhancing the economic model of their restaurants."

Higa Industries, the current owner of Wendy's Japan, took control of the company in 2011 but has been unable to expand its regional restaurant network as planned. It is expected to retain a minority stake in the company.

Wendy's exited the Japanese market in late 2009 with the closure of 71 restaurants after a decision not to renew its local franchise agreement. After Higa revived the chain two years later, it planned to expand to 100 outlets. However, Wendy's Japan currently has only one location while First Kitchen claims 136 restaurants nationwide.

Longreach says the investment reflects its strategy of adding value to high-quality specialty consumer businesses. The firm also invests in the technology, industrial and financial and business services sectors.

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• Topics
• North Asia
• Consumer
• Buyouts
• Expansion
• Japan
• The Longreach Group Limited