Atlanta and Canton, Mass. — Inspire Brands has agreed to acquire fast-food breakfast chain Dunkin’ Brands in a transaction valued at $11.3 billion. The deal is expected to close by the end of the year.
Atlanta-based Inspire Brands is the parent company of restaurant chains such as Arby’s, Jimmy John’s, Sonic Drive-In and Buffalo Wild Wings. In addition to its namesake coffee and breakfast chain, Canton, Mass.-based Dunkin’ Brands also owns ice cream parlor chain Baskin-Robbins, which respectively have about 12,500 and 8,000 locations worldwide. Dunkin’ has about 9,600 locations in the United States.
The deal’s price tag equates to $106.50 per share, to be paid in cash, and includes the assumption of all Dunkin’ Brands’ debt. The share price represents a 30% premium over the Dunkin’ Brands 30-day weighted average price and a 20% premium over its closing stock price of $88.79 per share on Friday, Oct. 23.
“We are excited to bring meaningful value to shareholders who have been with us on this journey and believe that Inspire Brands, a preeminent operator of franchised restaurant concepts, will continue to drive growth for our franchisees while remaining true to all that is unique and special about the Dunkin’ and Baskin-Robbins brands,” says Dave Hoffmann, CEO of Dunkin’ Brands.
Last week, several media outlets reported that talks of a merger between Inspire Brands and Dunkin’ were progressing, and that the deal would be valued at $8.8 billion.
The Dunkin’ Brands stock price shot up by as much as 15% at various points throughout the week before closing just below $100 per share on Friday, Oct. 30. The company’s stock price opened at $105.95 per share on Monday, Nov. 2, up from $76.85 per share a year ago.
In late July, Dunkin’ Brands announced that it would be closing some 800 stores by the end of the year, many of which were located in Speedway gas stations, in response to the outbreak of the novel coronavirus.
Barclays is serving as financial advisor to Inspire Brands, and Paul, Weiss, Rifkind, Wharton & Garrison LLP is serving as its legal counsel. BofA Securities Inc. is serving as exclusive financial advisor to Dunkin’ Brands, and Ropes & Gray LLP is serving as its legal counsel.
— Taylor Williams