Published:
Hooters of America, Inc. Concerned About Chanticleer's Acquisition Attempts
ATLANTA, July 18 /PRNewswire/ -- Today, Hooters of America, Inc. (HOA)
stated that it has concerns over Chanticleer Holdings' announcement that it
plans to acquire Texas Wings. Texas Wings is HOA's largest franchisee. It
operates 45 Hooters Restaurants in the state ofTexas under franchise
agreements withAtlanta-based HOA. Texas Wings' franchise agreements require
Texas Wings to obtain HOA's consent before it enters into any transfer
agreement. The franchise agreements also require Texas Wings to grant HOA a
right of first refusal. Although Chanticleer announced that Texas Wings has
signed an asset purchase agreement with Chanticleer, Texas Wings has not
requested or obtained HOA's consent, nor has it recognized HOA's right of
first refusal, in violation of its franchise agreements with HOA.
HOA is also concerned that Chanticleer is announcing yet another
acquisition when Chanticleer has apparently not yet closed a transaction with
Hooters Inc. (HI), an HOA licensee. HI operates 22 Hooters locations in
Chicago,New York City and theTampa Bay area. In March, Chanticleer
announced plans to acquire HI and close no later than July 31. Chanticleer
holds no rights to acquire franchisees without HOA's consent, and it appears
Chanticleer may not be able to close announced transactions in a timely
fashion.
Coby Brooks, the President and CEO of HOA, stated, "Although I am pleased
that our franchisees may be in a position to monetize the equity they have
built under years of HOA leadership, I do not want anyone to distract our
system with promises that may not be fulfilled. Hooters is performing well,
even during challenging economic times. However, our success is not
guaranteed, and it can be threatened when operators start thinking about
cashing out versus taking care of our guests. We are concerned that
Chanticleer may be attempting to create an illusion that it has certain rights
and understandings that extend beyond what it actually has."
Hooters franchisees are concerned as well. "Hooters of America is the
standard bearer for the Hooters concept. The Franchisees are very happy with
the direction HOA has taken the brand over the past few years under Coby
Brooks' direction. We have spent 25 years building the Hooters Brand with
Hooters of America and have just completed an agreement for a new 20-year
extension for all franchisees. Our focus is on the long run," stated Gary
McCully the President of Hooters Franchisee Association.
Hooters of America, Inc. is the franchisor and operator of over 440
Hooters restaurants in 42 states and 27 foreign countries. The first Hooters
opened in 1983 inClearwater, Florida and is celebrating its 25th anniversary
this year. Hooters is well-known for its brand of food and fun, featuring a
casual beach-theme atmosphere, a menu that features seafood, sandwiches and
Hooters nearly world famous chicken wings, and service provided by the
All-American cheerleaders, the Hooters Girls. For more information about
Hooters visit www.hooters.com .
SOURCE Hooters of America, Inc.
Copyright © 2009, PRNewswire
Copyright © 2009, NewsBlaze,
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