USA—Fat Brands has announced its acquisition of Nestle Toll House Café by Chip franchise brand from Crest Foods and will begin rebranding the dessert shops as Great American Cookies— an existing gourmet cookie franchise that FAT Brands already owns.
Once the transaction is completed, FAT Brands said it will rebrand the approximately 85 Nestle Toll House Café by Chip stores as Great American Cookies.
In a press release, FAT Brands stated the purchase is “expected to increase” the company’s dessert portfolio, specifically within the cookie and ice cream category.
The deal is also expected to increase FAT Brands’ manufacturing facility in Atlanta, Georgia, as well as drive the company’s supply chain efficiencies and create cost savings.
“In 2022 we are focused heavily on our deep organic growth pipeline, but we saw great value in making this accretive acquisition,” said Andy Wiederhorn, chief executive officer of FAT Brands.
“These stores will fold seamlessly into our quick-service division and provide us the opportunity to increase the capacity of our manufacturing business, a key growth objective.”
Founded in 1977, Great American Cookies was acquired by FAT Brands in the summer of 2021 as part of the company’s US$442.5 million acquisition of Global Franchise Group, a deal that also included Round Table Pizza, Marble Slab Creamery, Pretzelmaker and Hot Dog on a Stick.
Round Table Pizza and Twin Peaks were the company’s two best performing acquired brands during the quarter. The restaurants increased comparable sales by 7% and 24.4%, respectively, Wiederhorn said.
Acquisitions have been a major part of Fat’s growth strategy, which also includes organic and nontraditional growth. Fat’s 2021 acquisitions led to a 13.5% increase in systemwide sales, Wiederhorn said on the company’s Q1 earnings call.
“To date, acquisitions have been a strong growth vehicle for FAT Brands, and we anticipate the combination of our production and distribution facility and scale to increase the profitability of the franchisees that are joining us in this acquisition,” Wiederhorn said in the press release.
Nestle Toll House Café by Chip was founded in 1998 with the chain’s first location opening in Stonebrier Mall in Frisco, Texas, in 2000. The company’s products include cookies, cookie cakes, brownies, ice cream, and hot and cold beverages.
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