Focus Brands, a portfolio company of Roark Capital Group, has agreed to acquire publicly-traded Jamba, Inc. for $13 per share in cash, in a transaction valued at approximately $200 million.
Jamba (NASDAQ: JMBA), through its wholly-owned subsidiary, Jamba Juice Company, is a retailer of freshly blended whole fruit and vegetable smoothies, bowls, juices, cold-pressed shots, boosts, and snacks. Jamba Juice operates more than 800 franchised and company-owned stores worldwide. The company was founded in 1990 in San Luis Obispo, CA, by Kirk Perron, a cyclist and healthy lifestyle advocate, along with three of his friends. Jamba Juice is headquartered near Dallas in Frisco, TX (www.jambajuice.com).
Over the past 5 years, Jamba Juice has been moving away from owning and operating its own stores. While the number of stores has remained steady at 800 more than 94% are now franchised compared to 67% in 2014. In 2018, Jamba Juice had revenues of $74 million and an EBITDA of $5.7 million.
“We are delighted to have reached this agreement with Focus Brands and are confident that it will result in a positive outcome for our guests, our franchisees and our employees,” said Dave Pace, CEO of Jamba. “Over the last few years, we have worked hard to strengthen our foundation and reposition this iconic brand for the future. Partnering with Focus Brands will allow us to build on this work and further accelerate the company’s growth.”
Focus Brands is the franchisor and operator of more than 5,000 restaurants, cafes, ice cream shops and bakeries in the United States, the District of Columbia, Puerto Rico and over 50 foreign countries under the brand names Carvel, Cinnabon, Schlotzsky’s, Moe’s Southwest Grill, Auntie Anne’s, McAlister’s Deli, and Seattle’s Best Coffee. Focus Brands is headquartered in Atlanta (www.focusbrands.com).
Following the close of the transaction, Jamba will be a privately-held subsidiary of Focus Brands and will continue to be operated as an independent brand. “Benefiting from an extremely loyal customer base and strong franchise operators, Jamba Juice is one of the category leaders in the fast-growing smoothie and juice category,” said Steve DeSutter, CEO of Focus Brands. “We are excited to welcome Jamba Juice with such an iconic heritage into our family of well-known and highly loved ‘fan favorite’ brands.”
Roark Capital Group invests in franchised and multi-unit business models in the retail, restaurant, consumer and business services sectors. Since inception, Roark has invested in 64 franchise/multi-unit brands which collectively generate $32 billion in annual system revenues from 32,000 locations in 50 states and 81 countries. Roark is headquartered in Atlanta (www.roarkcapital.com).
Engaged Capital and Indus Capital Partners, which collectively own approximately 27% of the outstanding shares of Jamba, have entered into agreements to tender their shares under the agreement with Focus Brands.
The transaction is expected to close during the third quarter of 2018 and will be funded by Focus Brands using cash on hand and available borrowing capacity under its existing credit facilities.
North Point Advisors (www.nptadvisors.com) is the financial advisor to Jamba.
© 2018 Private Equity Professional | August 3, 2018