PAG Asia to take over Australian restaurant operator Craveable Brands

Craveable Brands operates restaurants under the Red Rooster, Oporto and Chicken Treat brands. Photo: Company website

Hong Kong-based private equity firm PAG Asia Capital has fully acquired Australian restaurant chain operator Craveable Brands from Archer Capital and minority shareholders, it said in an announcement on Friday.

No financial details were disclosed.

Craveable Brands claims to be the largest Australian-owned operator of quick services restaurants with over 580 stores under the Oporto, Red Rooster and Chicken Treat brands. It also operates restaurants in New Zealand, Singapore and Sri Lanka and is preparing to launch new stores in Vietnam and the Middle East.

According to PAG, the current Craveable Brands management will continue to lead the business.

“Craveable Brands is a terrific asset in the Australian QSR market, owning three iconic brands with significant scale. We see great opportunities for Craveable and look forward to working with management on the next stage of portfolio innovation,” said PAG chairman and CEO Weijian Shan.

PE investor Archer Capital acquired Craveable Brands in June 2011 from Quadrant Private Equity in a deal that was estimated to be worth about A$450 million ($315 million). According to Australian media reports, Archer Capital had planned to list Craveable Brands in July 2017 but decided not to go ahead with the IPO due to poor public market conditions.

“Since our investment in 2011, we have been successful in building this business to approximately A$800 million ($560 million) of network sales annually. We have had a great experience partnering with the management team led by Brett Holding and countless hardworking franchisees who have transformed the brands and customer experience,” said Archer Capital managing partner Peter Gold.

One of the biggest and oldest players in the Australian private equity market, Archer Capital was reportedly preparing to wind up as its founder Peter Wiggs was looking to retire.

It appears to have changed course, reviving plans to raise a sixth fund with a target of A$300 million ($208 million), according to The Australian Financial Review. Since its founding in 1997, the firm has closed over 35 acquisitions involving total aggregate funding in excess of A$6 billion.

Meanwhile, PAG closed its third Asia-focused buyout fund at $6 billion last November. The fund secured large capital commitments from US pension funds and sovereign wealth funds from Kuwait and Singapore.

PAG currently manages $30 million in capital for some of the world’s largest institutional investors with 10 offices across Asia. We had earlier reported that PAG is in the market to raise up to $1 billion for its third special situations fund to invest in distressed assets across Asia. The vehicle recently secured a $50-million commitment from San Francisco Employees’ Retirement System.