CALGARY, April 16, 2018 /CNW/ - Equicapita Income Trust and Equicapita Investment Corp. (collectively "Equicapita") are pleased to announce the completion of the acquisition of Smitty's Canada ("Smitty's") by a wholly-owned subsidiary of Equicapita (the "Acquisition").
Smitty's was founded in 1960 by Walter Chan and is headquartered in Calgary, Alberta. With 85 locations across Canada (80 franchise locations and 5 corporate locations), Smitty's is one of Canada's largest family restaurant chains. Smitty's has developed a long-term sustainable business model that attracts loyal customers, entrepreneurial franchisees, and has a strong supplier and franchise support system.
"The opportunity to acquire a well-known Canadian brand with resilient royalty income from the extensive franchisee network is transformational to the size and scope of Equicapita's investment portfolio. The Smitty's leadership team has consistently demonstrated its commitment to the integrity of the brand and a focus on core family values in building and maintaining the Smitty's network across Canada" said Equicapita co-founder, Michael Cook. "Smitty's provides Equicapita with further portfolio diversification, both geographically and by industry, and adds considerable stability to the portfolio's income profile."
Equicapita is committed to the long-term success of the Smitty's business which includes Smitty's strong relationships with its great network of franchisees. "We understand the family nature of this business and the importance of the franchisees to the long-term success of the overall business. Under the recent leadership of Chris Chan, and his grandfather before him, a business with family values was created and nurtured and we will remain focused on preserving that culture" said Michael Cook.
Smitty's will continue to be managed under the leadership of Steven Fee, President and Eric Metzler, Chief Financial Officer. Chris Chan has agreed to provide Smitty's his expertise over a transitionary period.
Consistent with Equicapita's investment mandate of assembling a diversified portfolio of long-established Canadian businesses, Smitty's has 58 years of operating history serving customers in many communities across Canada. Smitty's consistent history of strong profitability, along with the continuity of operations by its dedicated staff and excellent franchise operators, represent cornerstones of Equicapita's investment strategy.
The Acquisition closed on April 9, 2018. Following completion of the Acquisition, the business has been operating under the name "Smitty's Canada Inc.". The Acquisition represents Equicapita's seventh portfolio company acquisition and its second master franchisor generating royalty revenues.
Equicapita retained Norton Rose Fulbright Canada LLP and Pricewaterhouse Coopers LLP as advisors in connection with the Acquisition. Smitty's retained ATB M&A Advisory Services as financial advisors in connection with the Acquisition.
Founded in 2013, Equicapita is a private company buyout fund based in Calgary, Alberta with over $130 million in AUM focused on acquiring private, Canadian businesses with enterprise values ranging from $5 million to $50+ million.
For more information please contact:
Michael Cook, Director
This news release may contain certain information that is forward-looking, and, by its nature, such forward-looking information is subject to important risks and uncertainties. The words "anticipate," "expect," "may," "should"," "project,", "will" or other similar words are used to identify such forward-looking information. Those forward-looking statements herein made reflect Equicapita's beliefs and assumptions based on information available at the time the statements were made. Actual results or events may differ from those anticipated or predicted in these forward- looking statements, and the differences may be material. Factors which could cause actual results or events to differ materially from current expectations include, among other things: risks associated with the ownership and operation of businesses, including fluctuations in interest rates; employment retention; general economic conditions; supply and demand for businesses; competition for available businesses; changes in legislation and the regulatory environment; and international trade and global political conditions. Readers are cautioned not to place undue reliance on any forward-looking information contained in this news release. The forward-looking statements contained in this press release are made as of the date hereof and Equicapita undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
SOURCE Equicapita Income Trust