| July 1
July 1 Buyout firm Berkshire Partners LLC is in
advanced talks to acquire Portillo's Restaurant Group, the
largest privately owned restaurant chain in the U.S. Midwest,
for close to $1 billion, according to people familiar with the
Berkshire Partners has outbid other private equity firms for
the Chicago-based restaurant group, the sources said on Tuesday.
The sources, who asked not be identified because the talks
were not public, cautioned that negotiations had not yet been
finalized. Portillo's hired investment bank Piper Jaffray Cos
to shop it to potential buyers, they added.
Berkshire Partners, Portillo's and Piper Jaffray did not
immediately respond to requests for comment.
Portillo's, known for its hot dogs and Italian beef
sandwiches, has 38 locations in Illinois, Indiana, California
and Arizona, according to its website.
Founded in 1963 by Dick Portillo out of a small trailer,
Portillo's posted revenue of more than $300 million last year.
The company had annual earnings before interest, taxes,
depreciation and amortization of more than $70 million, the
Other restaurants owned by Portillo's include Barnelli's
Pasta Bowl, Luigi's House and Honey-Jam Cafe.
A sale of Portillo's would come as a slew of restaurant
chains try to sell themselves or go public as market valuations
for the sector hold strong.
Mexican restaurant chain Del Taco is in the early stages of
exploring a sale, Reuters reported last week.
In May, Darden Restaurants Inc agreed to sell its
Red Lobster seafood chain to private equity firm Golden Gate
Capital LLC for $2.1 billion.
Carlson Restaurants Inc agreed in May to sell its TGI
Fridays casual dining chain to private equity firms Sentinel
Capital Partners and TriArtisan Capital Partners for more than
Recent restaurant-chain public offerings have included Zoe's
Kitchen Inc, Potbelly Corp and Papa Murphy's
Holdings Inc. Restaurant groups El Pollo Loco Holdings
Inc and Dave & Buster's Inc are also pursuing IPOs.
An investment in Portillo's would make it the only
restaurant chain in Berkshire Partners' portfolio.
Boston-based Berkshire has invested in a number of retail
and consumer companies, including children's toy company Melissa
& Doug, grocery retailers Grocery Outlet and Farm Boy, and
apparel brand Citizens of Humanity.
Berkshire is currently deploying capital from its Berkshire
Fund VIII, a $4.5 billion private equity fund it raised in 2011.
(Reporting by Olivia Oran and Greg Roumeliotis in New York;
Editing by Jeffrey Benkoe)