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Yum! Brands Takes a Bite Out of the Competition with New Acquisition
The parent company of quick-service giants KFC, Pizza Hut and Taco Bell makes its first acquisition of 2020, acquiring The Habit Restaurants for $375 million.
Three household name QSRs—Taco Bell, Pizza Hut and KFC—have all lived under one roof of the Yum! Brands portfolio for quite some time, but according to QSR Magazine, there’s a new member of the family. The Habit Burger Grill is a fast casual concept specializing in charbroiled hamburgers that Business Insider says has a “cult following.”
The Habit will be a huge step for Yum! Brands into the fast casual sector, and likely boost this California-based regional favorite into a national sensation. Business Insider reported that the chain has been experiencing major growth in the past few years, increasing from 172 locations in 2017 to 278 worldwide by the end of 2019. This acquisition comes just six days into new CEO David Gibbs’ tenure, a former COO who was appointed to the title in August following the retirement announcement of 25-year company veteran Greg Creed.
"As a fast-casual concept with strong unit economics, The Habit Burger Grill is a fantastic addition to the Yum! family and has significant untapped growth potential in the U.S. and internationally," said Gibbs in a statement reported by Business Insider. "The transaction is a win-win because it allows us to offer an exciting new investment to our franchisees and to expand an award-winning, trend-forward brand through the power of Yum!'s unmatched scale and strengths in franchising, purchasing and brand-building."
This could be the first addition of many more to come for Yum! Brands, and at the very least in a significant step in a new direction for the kinds of the fast food space. "If a brand fits all of our criteria — a lot of which I can't share for strategic reasons — then yes, we would go do an acquisition and be excited about it,” Gibbs said in Business Insider.
While this is the company’s first burger joint, as a fast casual it isn’t necessarily in competition with its QSR rivals like Burger King and McDonald’s. For those of us who have never tried, or even heard of The Habit until today, one could be coming to you very soon with the help of Yum! Brands massive footprint and growth power.
Read the full story here.
