Quadrant-owned UPG buys Sydney restaurant chain

The deal size was not disclosed, although the addition of the Fratelli assets takes UPG's annualized revenue to more than A$200 million, while staff headcount will surpass 2,000. Quadrant bought UPG at a valuation of approximately A$175 million last October.

Tom Pash, CEO of UPG, told The Australian Financial Review that the company wants to build a portfolio of 10-12 brands and go public within 2-3 years at a valuation of A$1 billion. He noted that Australia is unusual in having few large-scale casual dining networks. These business models have gained traction in other markets because they can offer economies of scale and consistent quality.

"When you think about dining groups in the US or Europe, customers love them because they know there's this consistency. They know there's no surprises," Pash added.

Fratelli has four restaurants under the Café Sopra brand, a pizzeria and Fratelli Parlamento that serve Italian cuisine, four shops that sell fresh produce, and a French restaurant called Café Nice. UPG claims to be Australia's only true national restaurant group without gaming. It operates 20 establishments across three states, mostly under the Bavarian Bier Café and Sake Restaurant & Bar brands.

Quadrant is currently investing its seventh fund, which closed at A$850 million in early 2014. The firm's previous exposure to the restaurant space includes Quick Service Restaurants - sold to Archer Capital in 2011 - and Independent Pub Group. Quadrant and Next Capital completed their exit from the latter asset in September 2015, selling the remaining outlets to Blue Sky Alternative Investments.

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• Topics
• Australasia
• Buyouts
• Consumer
• Quadrant Private Equity
• Australia
• M&A