Dive Brief:
- Freddy’s Frozen Custard & Steakburgers has been acquired by investment funds affiliated with Rhône, a global private equity firm, from Thompson Street Capital Partners, according to a Thursday press release. Terms of the transaction and the purchase price were not disclosed.
- Thompson Street Capital Partners has owned the company since 2021 when the concept had about 400 units. Freddy’s currently has over 550 units in the U.S. and Canada that generate $1 billion in sales.
- Following the acquisition, Freddy’s C-suite will remain in place, with Chris Dull as president and CEO, Bill Valentes as CFO and Brian Wise as chief operating officer, alongside other current executives.
Dive Insight:
Freddy’s just started expanding outside the U.S. this year, opening its first international location in Winnipeg, Canada, in early June. Through a partnership with North 49 Frozen Custard and Steakburgers, the company will open locations across Winnipeg during the next few years.
Rhône has experience helping businesses expand globally and works with management teams to “drive growth and create long-term value,” the press release said. Rhône has experience with fast-growing restaurant brands and took Fogo de Chao private in 2018. It later sold it to Bain Capital in 2023 for about $1.1 billion, according to Reuters.
Under Thompson Street, Freddy’s has not only focused on growth, but also on boosting average unit volumes and improving the guest and franchisee experience, the press release said. This included improving “back-of-house efficiency, consumer digital platforms, menu innovation and franchisee support.”
Last year, Freddy’s opened a new training facility in Wichita, Kansas, to better educate managers and franchisees under a uniform standard. The facility is also functioning as a product innovation and testing site.
“Over the last few years, we’ve seen steady growth and surpassed many milestones for our brand, while simultaneously strengthening our franchise system and building a loyal guest following,” Dull said in a statement. “Together, we look forward to unlocking even greater opportunities for the Freddy’s franchise family.”
According to the chain’s franchise disclosure document, Freddy’s plans to open 70 franchised units this year, more than double the 30 franchised units that opened in 2024.
Lucas Flynn, managing director at Rhône, said his firm will support the chain's ongoing growth by bringing the “Freddy’s offering to more customers around the world and support[ing] the company in this next chapter of growth.”
During the past few months, private equity firms have been particularly active in acquiring high-growth brands. Levine Leichtman acquired Shipley Do-Nuts, Freeman Spogli bought Philz Coffee and Roark purchased a majority stake in Dave’s Hot Chicken.
