Financial terms of the deal, which closed yesterday, weren’t announced. Chattanooga, Tenn.-based Krystal claims to be the second-oldest quick service restaurant chain in the U.S. The 80-year old company is famous for its small, bite-sized hamburgers that are cheap. (A regular Krystal burger without cheese sells for 78 cents after tax. With cheese, the price jumps to $1.02.) The company employs about 6,000 people. Krystal owns and franchises a total of 360 restaurants in 11 states in the south.
Last August, Krystal announced it was searching for a buyer. It hired Piper Jaffray to advise on the auction. In December, I reported that the process was in the second stage and that PE firms were bidding for Krystal.
“Argonne recognizes the strength of the brand and provides a foundation for the Krystal family of employees and franchisees to continue its expansion by serving our loyal customers,” said Fred Exum, Krystal’s president and CEO, in a statement.
Krystal’s headquarters will remain in Chattanooga, the statement said.
Atlanta-based Argonne has much experience in the restaurant space. The PE firm owns more than 350 IHOP’s, Applebee’s and Stevi B’s Pizza restaurants. Argonne typically invests from $10 million to $150 million per deal, according to the firm’s website. “We have watched with great interest as Krystal has continued to develop quality products, offering outstanding customer service, and maintain brand dominance through the recession,” said Michael Klump, Argonne’s founder and president.
Damon Chandik and John Twichell led the deal team at Piper Jaffray.