The acquisition deal is valued at $49m on a cash-free, debt-free basis. Credit: Bryan W / Shutterstock.

US-based daytime dining chain First Watch has signed an agreement to acquire 16 franchise-owned restaurants, along with corresponding development rights in North and South Carolina.

The deal, which is valued at $49m on a cash-free, debt-free basis, includes 15 existing locations and one restaurant currently under construction, which is anticipated to open before the transaction concludes.

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The acquisition is expected to be finalised by mid-April 2025, subject to the fulfilment of customary closing conditions.

The deal will expand First Watch’s portfolio, which has seen the addition of 45 franchised restaurants through six accretive acquisitions since May 2023.

First Watch CEO and president Chris Tomasso said: “Strategic acquisitions of franchise-operated restaurants like this one continue to be an important part of our long-term growth and value creation strategy.

“These 16 restaurants and the corresponding development rights will help solidify corporate ownership of First Watch restaurants along the East Coast – and provide us with additional territories in which to grow organically for years to come.

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“We expect these restaurants will generate unit volumes and restaurant-level operating profit margins in line with our company-owned restaurants, and we look forward to welcoming the teams from these restaurants into our organisation.” 

The financial aspects of this latest acquisition will be managed through a mix of First Watch’s available cash reserves and potential borrowings under the company’s existing credit facility.

In April 2024, First Watch Restaurant Group concluded the previously announced acquisition of 21 franchise-owned restaurants and their development rights in North Carolina, US. 

The deal was secured for an aggregate purchase price of $75m on a cash-free, debt-free basis.