Pepper Lunch to be acquired by investment fund J-Star for US$79m
Collectively, the business has 514 restaurants in its portfolio.
Pepper Food Service Co., Ltd. has agreed to sell its lucrative Pepper Lunch business to investment fund J-Star for 8.5 billion yen (US$79 million).
“We will support the management team to establish a corporate foundation as an independent business, to accelerate domestic growth by leveraging its competitive advantage, as well as growth strategy through global expansion,” J-STAR Co., Ltd. representative director Rokuro Hara said in a statement.
Pepper Lunch, which features a cooking system in which selected steak meat or other proteins are cooked in front of customers, has expanded throughout Asia via franchise models.
The acquisition also includes the Pepper Lunch Diner, 92’s, Charcoal-Grilled Hamburger Steak Kuni, Tokyo 634 Berg, Musashi Hamburg and CAB Steak restaurant brands. In total, the business has 181 stores in Japan and 333 overseas.
An earlier report from Nikkei Asian Review suggests the sale was driven by an “immediate need for cash”, with most of the proceeds having already been earmarked.
Pepper Food, which also operates the Ikinari steak chain, needs to repay about 3.2 billion yen in short-term loans from lenders including MUFG Bank and also owing another 2 billion yen to President Shinnosuke Murakami of meat supplier S Foods, which reportedly must be paid back “within the next several months, on top of past-due payments for ingredient orders.”
Pepper Food is also expected to spend 2 billion yen on store closures and other restructuring measures, including lease termination fees and early retirement payments.
Photo credit: Pepper Lunch Singapore
