Captain D’s, Qdoba Attract New Owners in Separate Deals
Captain D's is a seafood-focused restaurant chain with a beachy interior vibe, which proved attractive to new owner Sentinel Capital.
Captain D’s sold to Sentinel Capital and Qdoba went to Apollo Global Management this week, in separate franchise deals that come amid the usual flurry of end-of-the-year mergers and acquisitions.
A Qdoba deal had been expected for months, after an announcement in May that Jack in the Box Inc., its parent company, said having two different business models could be holding down its valuation. Qdoba is a 725-unit Mexican chain and Jack in the Box is its burger-focused business with more than 2,200 units.
Apollo is a private equity firm run by co-founder Leon Block, which agreed to buy Qdoba for about $305 million in cash, proceeds of which Jack in the Box will use to retire outstanding debt. Apollo owns Chuck E. Cheese and is the former owner of Carl’s Jr.
Sentinel Capital, meanwhile, added Captain D’s to its portfolio of franchise brands, scooping up the franchisor and operator of 530 seafood-focused quick-service restaurants in 21 U.S. states. Captain D’s holds a “unique market position,” said John McCormack, a Sentinel senior partner, in a statement, adding Captain D’s has recently been attracting younger guests and is the “clear category leader.”
Sentinel has made eight other restaurant franchise investments since its inception, buying franchisors and franchisees alike. Those include Border Foods, a leading QSR franchisee of Taco Bell; Checkers/Rally’s, the largest franchisor and operator of dual drive-thru hamburger QSRs in the U.S.; Falcon Holdings, a franchisee of Church’s Chicken; Fazoli’s Group, an Italian restaurant chain; Huddle House, a franchisor of family dining restaurants; Newk’s Eatery; Southern California Pizza Company, the largest Pizza Hut franchisee in the greater Los Angeles market; and TGI Friday’s.