MTY enters into an agreement to acquire the assets of Madisons New York Grill & Bar
TSX Trading Symbol: "MTY"
MONTREAL, April 10, 2014 /CNW Telbec/ - MTY Food Group Inc. ("MTY" or the "Company") (TSX: MTY), franchisor and operator of multiple concepts of quick service restaurants, announced today that its wholly-owned subsidiary MTY Tiki Ming Enterprises Inc. has entered into a binding agreement to acquire some of the assets of a group of companies that owns and operate the Madisons New York Grill & Bar concept in Canada ("Madisons") www.madisonsnyc.com, for a total consideration of $13 million.
The acquisition will be made via a new subsidiary to be formed. MTY will own 90% of that subsidiary, while the other 10% will be owned by the new Vice President of the brand, Gilles Pépin. The purchase price will mostly be financed by a new banking facility, which will be guaranteed by MTY.
At the date of closing, Madisons is expected to have 14 franchised restaurants in operations in Canada. Sales for the Madisons system were $40M for the 2013 calendar year. Following the transaction, the operations of the franchisor will be relocated in MTY's existing offices in Ville St-Laurent, Quebec.
"We are pleased to make our entry in the casual dining segment through a brand as reputable as Madisons", said Stanley Ma, CEO of MTY. "This opens the door to a segment of the foodservice that has been very strong in the last few years and that is expected to continue its strong performance in the future."
The closing of the transaction is scheduled to happen on or before June 10th, 2014 and remains subject to several closing conditions as well as to standard regulatory approvals. The operations of Madisons in the United States are excluded from the transaction.
Certain information in this News Release may constitute "forward-looking" information that involves known and unknown risks, uncertainties, future expectations and other factors which may cause the actual results, performance or achievements of the Company or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking information. When used in this News Release, this information may include words such as "anticipate", "estimate", "may", "will", "expect", "believe", "plan" and other terminology. This information reflects current expectations regarding future events and operating performance and speaks only as of the date of this News Release. Except as required by law, we assume no obligation to update or revise forward-looking information to reflect new events or circumstances. Additional information is available in the Company's Management Discussion and Analysis, which can be found on SEDAR at www.sedar.com.
On Behalf of the Board of Directors of
MTY Food Group Inc.
Stanley Ma, Chairman, President & CEO
SOURCE MTY Food Group Inc.For further information:
For more information please contact Eric Lefebvre, Chief Financial Officer at 1-514-336-8885 or by email at email@example.com, or visit our website: www.mtygroup.com or SEDAR's website at www.sedar.com under the Company's name.