A potato-based staple of shopping-mall food courts across Canada is set to become an arm of the country’s biggest full-service restaurant operator.
The numbered owner of New York Fries agreed Monday to a cash deal to sell its entire stake to Cara Operations Ltd., which operates or franchises dining brands across Canada including Swiss Chalet, Harvey’s, Kelsey’s, East Side Mario’s, Montana’s and Milestones.
Toronto-based New York Fries was launched with a single outlet at Scarborough Town Centre in 1984 by brothers Jay and Hal Gould, based on their discovery of the “best french fries” in New York at Manhattan’s South Street Seaport in 1983.
Since then, the company said, its chain of both corporate-owned and franchised outlets has “differentiated itself by using fresh, high-quality ingredients cooked to order and as a result, has established a leadership position in the Canadian french fry and poutine market.”
In expansion mode since its IPO in April, Vaughn, Ont.-based Cara said adding New York Fries to its stable of brands will help “diversify Cara’s portfolio of stores into shopping centres, where Cara’s existing 10 brands currently have limited presence.”
Citing New York Fries’ “strong track record of growth, profitability and product development,” plus the relocation of New York Fries’ head office to Cara’s Vaughn office as part of its all-cash financed takeover, Cara CEO Bill Gregson said the deal will be accretive for Cara shareholders.
The deal is expected to close this fall, after which New York Fries’ business and back-end processes are to merge into Cara’s over the following 12 months. Financial terms of the deal weren’t released Monday.
New York Fries executive vice-president Warren Price will move over to Cara and continue to lead the brand, which today has 120 outlets in Canada and 36 overseas.
New York Fries co-founder Jay Gould, who in 2005 launched South St. Burger Co., noted the newer business is not part of the Cara deal.
“Cara is one of the most respected names in the Canadian foodservice industry and I am excited to have them take over New York Fries and continue to grow it,” Gould said in Cara’s release. “For my part, I will continue to build South St. Burger using the same principles that have worked so well all these years for New York Fries.”
Cara, whose other chains include Prime Pubs, Casey’s, Bier Markt and Landing restaurants, already operates over 825 restaurants across the country, 89 per cent of which are franchisee-operated and 72 per cent of which are in Ontario. — AGCanada.com Network