The Cheesecake Factory Inc. (Nasdaq: CAKE) has made a minority growth investment in restaurant chains North Italia and Flower Child, which are both owned by Fox Restaurant Concepts LLC. The transaction allows the Cheesecake Factory to potentially acquire a majority or full ownership stake in both brands.
North Italia, founded in 2002, is known for pizza and other Italian dishes like grilled branzino. The chain operates nine restaurants across Arizona, Texas, Colorado and California. Flower Child, founded in 2014, is known for salads, bowls and wraps. The company has five locations spread across Arizona, Texas and California. Phoenix-based Fox Restaurant will continue to operate both chains.
Fox Restaurant owns 53 restaurants under the Arrogant Butcher, Blanco Tacos + Tequila, Culinary Dropout, Doughbird, the Greene House, the Henry, Juby True, Little Cleo’s Seafood Legend, Olive & Ivy Restaurant & Marketplace, True Food Kitchen, Wildflower American Cuisine and Zinburger Wine & Burger Bar brands.
“We share a similar culture and philosophy, making this a good strategic fit for both companies,” says the Cheesecake Factory CEO David Overton. The Cheesecake Factory, located in Calabasas Hills, California, operates 193 restaurants under its own brand in addition to 12 Grand Lux Cafes.
Buyers have been showing interest in restaurant chains that have growth potential. CenterOak Partners LLC picked up a majority stake in Wetzel’s Pretzels LLC; General Atlantic has taken a minority stake in coffee and juice bar chain Joe & the Juice; Roark Capital acquired a majority stake in Jimmy John’s Sandwiches.