Known for its fried chicken, dirty rice and homemade biscuits, Bojangles at one time did have a Manhattan store, says Marc Oken, cofounder of Falfurrias Capital Partners. In September 2007, Falfurrias led an investor group to buy Bojangles in a deal valued at more than $200 million.
“We closed [the New York store] when we bought it,” he says.
The closure was due, in part, to marketing issue, he says. The most effective advertising is TV. But television isn’t appropriate if stores are scattered, Oken says. Charlotte, N.C.-based Bojangles has 503 stores and 375 are located in North and South Carolina. The rest are spread throughout states including Alabama, Tennessee and Georgia. “Those are out growth markets,” he says.
Bojangles also didn’t have the infrastructure to control quality and service in the New York store. “Brand is your most important asset,” Oken says. “Strategically, it didn’t make any sense to have a store up there.”
Today, Falfurrias, said it had sold its entire stake in Bojangles to Advent International. Financial terms weren’t disclosed and the deal is expected to close in August. One source pegged the sale at 10x EBITDA.
“The new owners will get [Bojangles] to New York,” says Oken, who declined to comment on a sale price. Advent, a Boston PE firm, may also open a Bojangles in their hometown, he says. “It’s a great opportunity for Advent,” he says.
Who else owns Bojangles? Jerry Richardson, owner of the NFL Carolina Panthers, was part of the Falfurrias-led investor group. Allied Capital also reportedly put in $25 million. The group had 75% of Bojangles but it’s unclear what Falfurrias specifically owned.
Falfurrias, also based in Charlotte, invested $25 million while the other investors put in $50 million, peHUB has learned. Bojangles, under Falfurrias’s ownership, saw its sales jump by 40% to nearly $800 million in projected 2011 sales, according to a statement.
Earlier this year, Falfurrias tapped Harris Williams to run an auction for its stake. Over 50 bidders were initially interested but this field was narrowed to eight, Oken says. “The most attractive was Advent,” he says.
Glenn Gurtcheff and Chris Williams of Harris Williams provided financial advice for Falfurrias. McGuire, Wood & Bissette was their attorney.
Jonathan Marino contributed to this report.