Atlanta-based Crescent Capital Investments, the private equity arm of First Islamic Investment Bank, has announced an agreement to buy Church’s Chicken chain from food franchisor AFC Enterprises for $390 million (€306 million)
The price includes $383 million in cash and a subordinated note from an affiliate of the buyer for $7 million, according to a statement.
Church’s Chicken, founded in Texas in 1952, is one of the largest fast food chains in the US. The restaurant franchise serves traditional fried chicken at more than 1200 units domestically and 300 international locations.
AFC Enterprises operates a number of food franchises, including Popeye’s Chicken & Biscuits; Cinnabon; and Seattle’s Best Coffee in Hawaii. The company had been looking for a strategic investor since this summer. Bear, Sterns & Co. served as advisor to AFC in the transaction.
Crescent Capital already owns several companies in the retail and consumer products industries, including Caribou Coffee Company and Loehmann’s Holdings. Last month, the firm beat off Terra Firma Capital Partners to acquire South Staffordshire water company in the UK for £142.6 million.
As shar’iah compliant, Crescent Capital typically shuns companies in the alcohol, gambling, and media industries. Islamic law governs what is considered to be sinful.
Founded in 1996 in Bahrain, First Islamic also has offices in London and Atlanta. As at the end of 2003, the firm had assets under management of $3.6 billion, total assets of $818 million and had generated net income of $44.8 million for 2003. Since 1998, Crescent Capital has arranged the investment of more than $900 million of equity in fifteen completed or pending transactions.