05 June

Norbrook Equity acquires Panamanian KFC & Dairy Queen franchises

DAVID ROSE Observer business writer

From left: Ike Johnson (Sygnus), Joshua Henríquez (FranPan), MaryCate Muschett (NEP), Ryan Reid (FirstRock), Khary Robinson (NEP)

Norbrook Equity Partners Limited and other co-investors have successfully acquired the Panamanian KFC and Dairy Queen franchises from Franquicias Panameñas, SA (FranPan).

The deal, which closed recently, has seen Platinum Brands, SA, a Panamanian special purpose vehicle, acquire 44 KFC and 35 Dairy Queen restaurants in the Central American country. The move also means that Norbrook has become the exclusive franchisee for both brands in Panama which have more than 1,700 employees. Both franchises were owned by FranPan, which is a 60-year-old family company in the quick service restaurant (QSR) business with over 200 restaurants including brands such as Taco Bell, Pizza Hut, Quiznos, Pizza Pizza, and Chili’s.

“We are delighted to have found in Norbrook and its management team people who share our values and understand the potential of KFC and Dairy Queen in Panama. This transition allows us to focus on our legacy while entrusting the future of these beloved brands to capable hands,” said Liza Henriquez, spokesperson for the family-run business FranPan.

Norbrook Restaurant Holdings Limited (formerly Norbrook QSR Limited), a St Lucian international business company, will own 60 per cent of Platinum Brands while FirstRock Private Equity Limited, Sygnus Deneb Investments Limited and the Henriquez family will own the remaining interest. Khary Robinson, founder and executive chairman of Norbrook Equity Partners, will become the executive chairman of Platinum Brands and work with newly appointed CEO Juan Carlos Andrade and CFO Christian Sturla. Andrade and Sturla have 50 years of combined experience managing 1,000 fast food restaurants between them in markets like Guatemala, Argentina and Mexico for brands like KFC, McDonalds and Pizza Hut.

“In this business, the idea is to grow in three dimensions: to grow service, to grow quality and growth of stores. So, we’re looking to expand and grow our footprint in Panama. We’re the number two platform in Panama behind McDonalds, but they have almost twice as many stores as us. So, that shows you that there are as many sub-markets within Panama that we aren’t covering today and there’s really growth opportunity for the KFC brand,” said Robinson in a call with the Jamaica Observer yesterday.

This is the second Latin American deal that Norbrook has publicly announced in the last three years following its October 2021 acquisition of Grupo Alaska SA, a business which acquired the assets and liabilities of an ice and water manufacturer and distributor in the Dominican Republic. Grupo Alaska SA is owned by Grupo Frontera Limited which is a joint venture co-owned between Norbrook Equity Partners and Pan Jamaica Group Limited. Jamaica Producers Group Limited, the then investor in the joint venture, invested $266.07 million into Grupo Frontera.

Mailpac Group Limited, Norbrook’s 72.60 per cent subsidiary, acquired the assets and operations of MyCart Express on April 1, a move which is set to move Mailpac Group’s revenue by at least 50 per cent. Mailpac is set to have an extraordinary general meeting (EGM) later this year to approve the issuance of new Mailpac shares to the co-founders and approve the rebranding of the company to MyPac Group.
MyCart co-founder Kamar Palmer and NCBJ Executive Vice-President Sheree Martin joined the board of Mailpac Group on June 1. Palmer joins the board following the acquisition while Martin is the latest independent director to join Mailpac’s board to satisfy Jamaica Stock Exchange (JSE) audit committee requirements.

“At Sygnus Deneb, we understand that true growth and value creation stem from strategic partnerships and a shared vision. Our recent collaboration in the acquisition of KFC and Dairy Queen franchises in Panama exemplifies our commitment to investing in businesses throughout the Caribbean. By partnering with Norbrook, we are supporting the expansion of these famed brands and delivering sustainable returns for our investors,” said Dr Ike Johnson, co-founder and chief operating officer of Sygnus Capital Limited.

This is Sygnus Deneb’s first private equity investment following a US$20-million private equity fundraise in June 2023. Sygnus Deneb has stakes in Aruba Wine and Dine, Chukka Caribbean Holdings Limited, CS&T Group Limited, and Caribbean Maritime Investments. Sygnus Deneb was founded in November 2018 and completed its first acquisition in February 2020.

“FirstRock Private Equity is proud to be part of this strategic investment in the Panamanian market. We believe in the potential of KFC and Dairy Queen to thrive under the leadership of the Norbrook team, and we look forward to contributing to the success of these iconic brands in the region,” said Ryan Reid, FirstRock PE co-founder and executive chairman.

This represents FirstRock PE’s fourth private equity asset following Dolla Financial Services Limited, My Ocean Limited and Optimum Distributors Limited.

The acquisition was supported with bank financing from JMMB Bank (Jamaica) Limited, a financing partner for Norbrook, and BAC International Corporation providing Platinum with acquisition financing as well as all the treasury management, transaction services, and cash management services required to support the company’s restaurant portfolio. Morgan & Morgan was Norbrook’s Panamanian legal counsel.

Norbrook’s business operates in Jamaica, West Africa and the United States of America. Norbrook had announced earlier this year that it intends to bring two of its subsidiaries to the public equity markets during 2024. Norbrook Equity Partners, a St Lucian IBC, has had two changes to its authorized share capital and change to its capital structure since January 2020.

“Our growth strategy has always been to invest in and acquire good and well-positioned businesses and continue to expand that and this is just another step in that journey. All of the other things that we have continue to grow, all of our subsidiaries are continuing to grow and we’re looking at opportunities globally just to really expand our ability to take capital, good people and good processes and grow businesses or projects to generate good returns,” Robinson closed as he noted that 2024 will be interesting for them.

Norbrook Equity acquires Panamanian KFC & Dairy Queen franchises – Jamaica Observer