Boston Market Buyer Is Cricket Booster, P.M. Modi Fan
Jay Pandya spent the days after buying Boston Market, the rotisserie chicken restaurant chain that has seen fatter times, in a mad dash to get stores open again. "We have already opened up eight locations," he said when he finally had a minute for an interview May 8, about 10 days after the deal was announced. "We are on pace to open 20 more in the next month."
Most of the locations closed had furloughed employees. "We are bringing those people back. We are actually creating jobs. We have added another 300 jobs in the last 10 days. We are moving," he said.
Pandya came to Philadelphia from India when he was 14 years old, and today has built the Rohan Group of Companies, with investments in real estate and restaurants. "I think it's one of the brands which is iconic, and everyone loves. It just has lost its spotlight, so we have to polish it," he said about Boston Market, which he purchased from Sun Capital Partners for an amount he would not disclose. "The food is really good. It just needs rejuvenation, so kind of back to the basics."
It had 376 domestic units, down from 430, at the end of 2019 and closed 45 stores last year. Pandya wants to develop corporate-owned stores at first, as many as 100 to 150. Would he consider franchising down the line? "Sure," he said.
First Franchise Capital based in Indianapolis sued Pandya's firm in April 2019 for $19.55 million, saying the operator of 70 fast-food restaurants defaulted on payments and let its Pizza Hut and Checkers & Rally's restaurants fall into disrepair.
"We had a little bit of a situation with First Franchise Capital, but our capital company, Rohan Capital, ended up purchasing the entire note from the president of First Franchise Capital," Pandya said. "It was a great transaction for us as well as for them." He said he's sold seven of his Pizza Hut locations in the Philly area to another franchisee.
Pandya's dream venture, announced in 2018, to build eight cricket stadiums across the United States and field a professional cricket league, is on hold, he said. "Cricket is the second-most-watched sport in the world, so we are looking to develop a league," he said, "but you need to build stadiums before you get into the league structures. The COVID pandemic put a stop on that completely. We will do something probably starting next year. Right now everyone's been on a pause."
He's a big fan of India's Prime Minister Narendra Modi, and tweeted his support last September when Modi visited Houston and met a delegation from Philadelphia.
"We support U wholeheartedly & our Congressman Brian Fitzpatrick was there to show all of our support from PA & the Indian community. God bless you, India and the United States of America," it said.
"Prime Minister Modi is really a role model. I grew up in the same state of which he was chief minister, and I have seen his progress," he said, adding he has "a lot of family in India" along with strong ties in Philly. "Philadelphia is a great town. I got everything here from Philadelphia, so I feel very excited to be part of it."
Restoration 1 CEO offers encouraging words for comebacks
"Here's what I know, and it's always been true. We, being the United States, always bounce back. We'll get back," said Gary Findley, CEO of Restoration 1 and Bluefrog Plumbing + Drain, who attracted new investors despite a pause in the world of deal-making during COVID-19, Nonetheless, two auto brands, two home services brands and a direct marketing franchise attracted new backers. As Jay Pandya, the buyer of Boston Market featured above, says: "Deals always happen, regardless of what the timings are."
Driven Brands, the largest automotive services company in North America, acquired Fix Auto USA and Auto Center Auto Body. This acquisition adds nearly 150 franchised and ten company collision repair locations to the Paint, Collision & Glass segment of Driven Brands. “We’d been in talks with the groups for a period of time prior to COVID-19, and we’d made a commitment and wanted to stay true to it,” said Michael Macaluso, Driven Brands’ group president of the Paint, Collision & Glass segment. “We closed the deal regardless of the economic climate…mutual plans for growth and franchise success fit in very well with the Driven Brands’ philosophy.”
All locations will retain their current Fix branding and join the Paint, Collision & Glass segment, which includes the Carstar, Maaco, Abra and Uniban brands. Since Roark Capital affiliates acquired Driven Brands in 2015, it has closed 38 acquisitions, increasing the brands’ footprint to more than 3,000 location across North America. “This is an opportunity to accelerate our growth plans. We didn’t acquire just to stay stagnant,” Macaluso said. “We want to grow in sales and business development moving forward, and continue expanding our footprint in a practical, reasonable and proper way.”
• Local Marketing Solutions Group (LMSG) acquired the assets of direct marketing franchise Money Mailer, based in Cypress, California. LMSG tapped long-time multi-unit Money Mailer and IHOP franchisee Tom Baber to lead the company as CEO. Founded in 1979, Money Mailer provides mailing and digital marketing services to corporate and franchise-owned brands—from home improvement and gardening to retail—in more than 30 states. LMSG’s goal is to enable Money Mailer franchisees to help small- and medium-sized businesses on Main Street recover and thrive post-COVID-19.
• The owner of 34 CorePower Yoga franchise locations is suing the franchisor for backing out of a $23-million deal to acquire the yoga studios. In the lawsuit, the franchisee claims that “defendants just want out of the obligation to buy Plaintiff’s 34 yoga studios because COVID-19 and the government responses to it, including the temporary closure of businesses like yoga studios, have changed the economics of the deal.” The deal would have included the acquisition of yoga studios in Colorado, Illinois, North Carolina, South Carolina and Arizona. The lawsuit was filed on April 2, a day after the first stage of the three-part deal was supposed to close with CorePower paying $6.3 million for eight Colorado locations owned by Level 4 Yoga, according to the complaint.
• Restoration 1 and Bluefrog Plumbing + Drain landed a majority investment from MPK Equity Partners and Princeton Equity Group, and CEO Gary Findley says he and his new backers are looking for more purchases in the services space. "It's going to be an exciting year. This is what I was looking towards," he said. "My future was around Restoration 1, Bluefrog, and I needed the right partner. And I have the right partner now." Restoration 1 and Bluefrog were both categorized as essential businesses in the pandemic, but Findley, who helped build women's fitness chain Curves from three to 8,000 units in eight years, knows the other side of the coin as well. "My heart goes out to these people who are not," considered essential, "but here's what I know, and it's always been true. We, being the United States, always bounce back. We'll get back. I want everybody to get back, too."
—Dealmakers briefs by Callie Evergreen. Send details of your franchise M&A deals to email@example.com.