Sentinel sells restaurant chain Checkers & Rally’s for $525 mln

Sentinel Capital Partners has sold Tampa, Florida-based drive-through restaurant chain Checkers & Rally’s for $525 million. The buyer is Oak Hill Capital Partners.

PRESS RELEASE

NEW YORK, April 25, 2017 – Sentinel Capital Partners, a private equity firm that invests in promising, lower middle market companies, today announced the closing of its sale of Checkers and Rally’s Restaurants, Inc. in an all-cash transaction valued at $525 million.

Checkers & Rally’s Restaurants, Inc. is an iconic and innovative drive-thru restaurant chain with 850 restaurants and room to grow. Checkers & Rally’s differentiates itself by delivering high quality, craveable meals at exceptional values. Checkers and Rally’s, together with its outstanding franchisee partners, offers a distinctive menu focused on bold, innovative products that are delivered to guests with category-leading value.

“Since the beginning of our investment, it has been a great pleasure partnering with Checkers’ exceptional, highly talented management team,” said Michael Fabian, a Sentinel partner. “Over the past three years, Checkers’ same-store sales have outpaced the hamburger QSR segment, and its store footprint has expanded by more than 10%. In addition, through important operational initiatives, store profit margins have improved steadily. Checkers is well-positioned to continue as a vibrant and successful franchise brand.”

Rick Silva, President and CEO of Checkers, commented, “We are delivering record growth at Checkers and Rally’s, and our franchisees, operators, and employees are more excited than ever about our future.”

The past year has been highly productive for Sentinel. Besides exiting Checkers, Sentinel also recently announced its exit of Power Products, a leading global provider of branded electrical products and systems. And during the past year, Sentinel has made six new platform investments, including: Altima Dental, the largest dental services organization in Canada; Cabi, a leading direct marketer of women’s fashion apparel; The Luminaires Group, a leading North American manufacturer of specification-grade lighting products; Quick Weight Loss Centers, a multistate provider of highly differentiated weight loss management services; Revenew International, a leading provider of cost recovery and cost containment services; and SONNY’S Enterprises, the worldwide leader in conveyorized car wash systems.

About Sentinel Capital Partners
Sentinel Capital Partners specializes in buying and building companies at the lower end of the middle market in the United States and Canada in partnership with management. Sentinel targets aerospace and defense, business services, consumer, distribution, food and restaurants, franchising, healthcare, and industrial businesses. Sentinel invests in management buyouts, recapitalizations, corporate divestitures, and going-private transactions of businesses with EBITDA of up to $65 million. Sentinel also invests in special situations, including balance sheet restructurings, and operational turnarounds. For more information about Sentinel, visit www.sentinelpartners.com.

About Checkers Drive-In Restaurants, Inc.
Based in Tampa, Fla., Checkers & Rally’s Restaurants, Inc., an iconic and innovative drive-thru restaurant chain known for its “Crazy Good Food,” exceptional value and people-first attitude, operates and franchises both Checkers ® and Rally’s ® restaurants. With 850 restaurants and room to grow, Checkers & Rally’s is a proven brand with flexible building formats that is aggressively expanding across the country. In recent years, the brand has been awarded several of the industry’s most prestigious awards including: No. 1 Restaurant Franchise in Franchise Business Review’s Top 50 Multi-Unit Franchises for 2015, Top 500 by Entrepreneur Magazine, and Best Drive-Thru in America by QSR Magazine.