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US Equity Investor Buys Brazilian Restaurant Chain Frango Assado

Frango Assado Restaurant in Brazil Brazil's Frango Assado, the leading operator of highway restaurants in Brazil, has been bought by US-based private equity investor Advent International. Advent informed that it has acquired 100% of the Brazilian company from the founding families. The names of the families and value of the transaction were not disclosed.

Founded in 1952, Frango Assado (which means grilled chicken in Portuguese) operates 12 large-format restaurants and retail stores along the busiest roadways in São Paulo. The company is projecting sales of over US$ 120 million in 2008 and expects to serve more than 20 million customers this year.

The deal is the third Latin American investment announced by Advent this month, following its acquisitions of Aeropuertos Dominicanos Siglo XXI SA ("Aerodom"), the leading airport group in the Dominican Republic, and Quero-Quero, a leading home-improvement retailer in southern Brazil.

It is also Advent's sixth acquisition of a restaurant chain in Latin America in the past two years and an important milestone in the firm's strategy to consolidate the region's fragmented, high-growth restaurant and casual dining segment.

Advent is forming a new company, International Meal Company (IMC), to hold all of its investments in the sector. In addition to Frango Assado, these include: Viena, Brazil's leading quick-casual and casual dining restaurant chain; Grupo RA, the No. 1 operator of restaurant concessions in Brazil's main airports; La Mansion, a leading casual dining restaurant group in Mexico; Champs Elysées, a Mexican operator of French restaurants and bistros; and IMC Caribe (formerly Airport Shoppes), the leading airport restaurant and in-flight catering group in Puerto Rico.

Once the businesses are consolidated into IMC, it should become the largest casual dining restaurant group in Latin America, operating more than 160 restaurants in Brazil, Mexico and the Caribbean, employing over 7,000 people and generating revenue of US$ 380 million this year.

"Frango Assado is a great addition to our portfolio, because it marks our entry into the highway segment, building on our presence in airports, shopping malls and city centers," said Javier Gavilan, CEO of IMC.

"It's a prime example of the type of restaurant chains we look to acquire: fast-growing, cash-generative businesses in premium locations with long-term contracts, strong local brands and significant expansion potential."

Valmik Mamprin, Director of Frango Assado, said, "We are extremely pleased to partner with Advent and believe that becoming part of the larger IMC group will offer significant benefits to Frango Assado. These include joint purchasing power, sharing of operational best practices, economies of scale and, most importantly, the opportunity to expand the Frango Assado concept into other market segments and geographies where Advent's restaurant companies operate."

Mr. Gavilan added: "With Frango Assado, Advent has achieved critical mass and established itself as the premier consolidator of casual dining restaurants in Latin America. Looking ahead, we have an active pipeline of additional M&A targets and plan to continue expanding the network organically through new store openings."

Since it began operating in Latin America 12 years ago, Advent International has invested in 39 companies with a combined enterprise value exceeding US$ 8 billion.

Founded in 1984, Advent International is one of the world's leading global buyout firms, with offices in 15 countries on four continents. The firm focuses on international buyouts, strategic restructuring opportunities and growth buyouts in five core sectors, working actively with management teams to drive revenue and profit growth in portfolio companies.

Since inception, Advent has raised US$ 24 billion in private equity capital and completed more than 250 buyout and private equity transactions valued at over US$ 40 billion in 40 countries.


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