Jack in the Box buys another fast food giant Del Taco for $ 575 million

Jack in the Box Restaurant

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Jack in the Box is buying Del Taco for $ 575 million, the fast food giant said on Monday.

Launched in 1964, Del Taco is the second largest Mexican quick-service restaurant in the country. It serves more than 3 million people per week at its nearly 600 locations in 16 states. Jack in the Box specializes in a variety of foods, from chicken fillets and fries to tacos and spring rolls.

Together, Del Taco and Jack in the Box will have more than 2,800 restaurants in 25 states.

“We are delighted to welcome Del Taco, a beloved brand and proven regional winner, to the Jack in the Box family,” said Darin Harris, CEO of Jack in the Box, in a statement Monday. “This is a natural combination of two like-minded challenger brands with exceptional growth opportunities.”

Del Taco

Del Taco

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Harris added, “Del Taco has a loyal and passionate customer base and a strong operating model, and we believe we can leverage our infrastructure, refranchising experience and development strategy to support growth plans. of Del Taco and extend the footprint of Del Taco. We can “Don’t wait to welcome the Del Taco team members and franchisees to the Jack family!”

John D. Cappasola, Jr., President and CEO of Del Taco, said Del Taco is “excited” to partner with a company “that shares our vision for the future and has the QSR expertise to further accelerate the growth of Del Taco ”.

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The deal will include existing debt, according to the company’s press release.

The sale comes about three years after Jack in the Box parted ways with Qdoba. Jack in the Box bought the Mexican fast-casual chain in 2003 and finalized the decision to sell it in 2018 after Qdoba suffered a decline in sales, according to ABC 7.

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Harris said on Monday that Del Taco would be a better fit than Qdoba because it already attracts customers similar to Jack in the Box and has locations in the same markets. Del Taco’s drive-thru volume is also comparable, as 99% of its locations offer drive-thru compared to Jack in the Box’s 90%. Harris said this was a “key differentiation,” given that Qdoba doesn’t have a lot of drive-thru services, ABC 7 reports.

As part of its deal with Del Taco, Jack in the Box expects annual unit growth of 4% by 2025, the statement said.

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