Spanish for "the Crazy Chicken," El Pollo Loco currently operates 328 restaurants: 139 are owned and operated by the company; 189 are owned by franchisees. The restaurants are currently located in California, Arizona, Nevada and Texas, with the first Chicago restaurant scheduled to open in mid-October, 2005. As part of its plans to expand nationwide, El Pollo Loco has a "strong pipeline" of company-owned and franchise restaurants in California, Colorado, New England, New Jersey, New York, Oregon, Texas and Washington, DC.
American Securities Capital Partners, LP purchased El Pollo Loco from Advantica Restaurant Group in December of 1999. Glenn Kaufman, managing director with American Securities, says the company targets and works with "profitable and specially positioned companies to generate long-term capital appreciation." Calling El Pollo Loco a "classic success story," he says the partnership has been a triumphant investment for American Securities.
Through continued and long-term focus on operational investment and strategic growth during its time with American Securities, the company says El Pollo Loco has substantially improved restaurant level operating performance while more than doubling the company's profitability.
"The heritage of our firm is in building great enterprises," says Kaufman. "We are completely committed to working as partners with managers to build businesses that are far better operationally, financially and competitively when we exit than when we initially invested. Our El Pollo Loco experience is a perfect example of our business philosophy."
However, in its latest quartly report filed in March, the company reported that net income for the fourth quarter ended Dec. 29 totaled $800,000--a decrease of $400,000 from net income of $1.2 million for the fourth quarter of fiscal 2003. Net income for the full year decreased to $3.8 million from fiscal 2003 net income of $7.4 million, which the company attributed to an increase in interest expense.
El Pollo Loco's management team, headed by president and CEO, Stephen E. Carley, will continue in their current positions and will be investors in the transaction. "Trimaran has an excellent track record of pinpointing key trends that serve as exciting growth engines," Carley says. Carley adds that the team has faith in Trimaran's operating experience and believes the new ownership "will complement our team as we work together to grow the exciting El Pollo Loco concept to the next level."
Trimaran possesses a similar growth strategy of extending a dominant regional concept into new markets. Trimaran also touts an interest in healthy food and healthy eating with its founding of the Hain Celestial Group, a leading natural and organic beverage, snack, specialty food and personal care products company in North America and Europe with brands such as Celestial Seasonings and Terra Chips.
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