KFC UK & Ireland franchisee, the Castlebarn group of companies, comprising 13 restaurants in South East London and Kent area, has been sold to a fellow KFC franchisee, the Caskade Group, for an undisclosed sum.
David Catterall and Anton Jebaharan, who have worked with KFC for over 35 years, acquired Castlebarn in 2007 through an MBO and developed it into a successful 13-strong chain employing over 500 staff. The pair also ran Taco Bell restaurants, which like KFC are part of Yum! Brands, but sold these several years ago in the first step to retirement from their restaurant interests.
The sale came at a time when many restaurant and other hospitality chains were enduring immense financial pressure. However, KFC demonstrated strong leadership in the sector, being one of the first to gradually and responsibly reopen its restaurants after initial closure due to the pandemic. In doing so, it demonstrated incredible resilience, with trade quickly bouncing back beyond pre-Covid levels.
The buyer, Caskade Group, now operates 47 KFC and 21 Taco Bell restaurants, having joined the KFC family in 1996.
Former owner David Catterall commented: “We’re delighted to have completed the transaction despite the COVID-19 pandemic, and to have sold to a fellow KFC franchisee. PKF Smith Cooper demonstrated great knowledge of the sector and deployed this, and their deal management expertise, to drive the deal to a completion – always considering the commercial, operational and financial implications for us as sellers.”
John Farnsworth, Head of Corporate Finance at PKF Smith Cooper and specialist in the food and beverage M&A sector, who led the deal alongside Corporate Finance Director David Crump commented: “A sale was originally agreed prior to the first government-imposed lockdown – which brought all the deals we were working on to a temporary halt. However, the strength of the KFC brand meant that trading recovered quickly and, as a result, the delay on this transaction was a matter of just a few weeks – making this August 2020 completion our first during the pandemic. That recovery is a testament to both the business skills and experience of David and Anton, and to the team at KFC UK & Ireland, who demonstrated real sector leadership in challenging circumstances. It is really pleasing to complete this deal during a very difficult time.”
“It was a pleasure to work with the sellers in devising a clear exit strategy, and to achieve an outcome that reflected the true value of the business. We wish both David and Anton the very best.”
David Crump, Corporate Finance Director
Legal advice was provided to the sellers by Flint Bishop, led by partner, Rachel Bennett and senior associate, William Bowler.
Rachel Bennett commented: “2020 was a challenging year for deals, but this is a great example of a business and a sector that has adapted well to the COVID-19 crisis. We are certainly seeing continued appetite from buyers and funders across a range of sectors where businesses have seized opportunities and remained resilient during the crisis.
It was great to work with the sellers and PKF Corporate Finance on this transaction. It is always pleasing to see a successful exit for sellers who originally acquired the business through a management buy-out.”