Denny's to acquire Keke's Breakfast Cafe

Denny's Corporation on May 3 announced it has signed an agreement to purchase the Florida-based Keke's Breakfast Cafe for $82.5 million.

Denny's officials announced the acquisition in its first-quarter report.

"Today, we announced the anticipated acquisition of Keke's Breakfast Cafe, which we believe can drive incremental growth that complements the Denny's brand," Denny's CEO John Miller said. "Keke’s is a high-growth brand that aligns well with our core competency while providing us with an opportunity to participate in the fast-growing A.M. eatery segment. We intend to utilize the proven capabilities of our franchise-focused business model to develop Keke’s across multiple states with the long-term target of becoming the A.M. eatery franchisor of choice."

Details of the purchase include:

• 100% asset purchase utilizing cash and the company's revolving credit facility

• Purchase price represents an EBITDA multiple of approximately 12x

• 52 restaurants, including 44 franchised locations and eight company locations

• System average unit volumes of about $1.9 million

Keke's Breakfast Cafe will operate independently from Denny's, with its own leadership, strategies, products, marketing, operations and development initiatives. Keke's currently operates three locations in West Orange and Southwest Orange — in Horizon West, Ocoee and Dr. Phillips.