Golden Gate in 3x exit to Fortress

The firm is selling Mexican restaurant chain On The Border, which it acquired for $180 in 2010.  

San Francisco-based Golden Gate Capital  will sell Border Holdings, which operates On The Border Mexican Restaurants to Argonne Capital Group and Fortress Investment Group, according to a statement. 

Golden Gate declined to disclose a return multiple for the deal but a source with knowledge of the situation said the exits generates more than a 3x return for Golden Gate.

On The Border is the largest full-service Mexican restaurant brand in the country, and owns and operates 121 units across the US. The brand also franchises 36 units across the US., Puerto Rico, Saudi Arabia and South Korea.   

Golden Gate is a generalist private equity firm, and bought Border Holdings in 2010 for $180 million. In addition to Border Holdings, Golden Gate owns the California Pizza Kitchen and CPK ASAP brands. The firm’s most recent fund closed on $3.5 billion in 2011. 

Both Argonne and Fortress have existing restaurant investments that are either outright or through franchisee holding companies. Argonne’s restaurants include Krystal, Stevi B’s Pizza, Applebee’s and IHOP.