After almost 25 years, Flynn Restaurant Group is dropping the “Restaurant” in its title after buying 37 Planet Health models.
The newly named Flynn Group, led by CEO and founder Greg Flynn, purchased Alder Companions, an Atlanta and Boston Planet Health franchisee. The group introduced the acquisition November 1.
“It was simply time for the subsequent chapter,” Flynn instructed Franchise Instances. The primary chapter was increasing its Applebee’s portfolio, the second chapter was increasing into different restaurant franchises, resembling Taco Bell and Pizza Hut. Now, stated Flynn, it’s time to broaden outdoors the restaurant sector.
“Planet Health was one of the best first step. It’s an absolute dominant operator in health. With 2,400 golf equipment, nobody even comes shut,” he stated.
Planet Health ranked No. 29 on Franchise Instances’ High 400 record this 12 months. Systemwide gross sales in 2022 grew 14.7 p.c to $3.9 billion and unit rely went up 6.9 p.c to 2,410. The New Hampshire-based franchise has gyms in all 50 states, plus Canada and Latin America.
Flynn is the biggest restaurant franchisee on the planet and ranked No. 1 this 12 months on the Franchise Instances Restaurant 200 record with $4 billion in gross sales and a couple of,300 places open by the top of final 12 months.
Firth Third Securities suggested either side of the deal.
That is the third main deal Flynn executed this 12 months. The group purchased Pizza Hut Australia in June, including 260 shops and gaining improvement rights for the continent. This acquisition was the primary worldwide funding since its inception.
Flynn additionally signed a grasp franchise settlement for Wendy’s in Australia this summer time. The group plans to open 200 Wendy’s shops within the subsequent decade.
Flynn admired Alder Companions’ portfolio and efficiency. “It’s one of many high performers” within the Planet Health system “throughout the board,” he stated. Alder is led by Stan DeMartinis and he’ll proceed to run Alder following the deal.
In 12 years, Alder developed 31 gyms, and in 2020 the group purchased six current places in Massachusetts.
The Alder acquisition was within the works for a couple of 12 months, Flynn stated. “It’s a very long time within the making. We’ve actually gotten to know one another and actually gotten to like and respect one another,” Flynn stated.
Flynn has been curious about Planet Health for years, earlier than the group was able to broaden outdoors the restaurant house.
“It’s obtained a really broad demographic enchantment. It’s obtained nice top-of-mind consciousness. It has the working methods all labored out superbly and has fantastic unit economics, nice model management,” he stated. “It’s obtained an enormous advertising and marketing finances, which is one thing we search for in all our manufacturers.”
Longtime Planet Health CEO Chris Rondeau stepped down final month on the request of the board of administrators. Share costs dropped considerably following Rondeau’s resignation. The model didn’t present a motive for the departure, however board member Craig Benson was appointed interim CEO.
The management change doesn’t fear Flynn, although. “All manufacturers evolve over time. Manufacturers sometimes want a change in management,” he stated. “I’ve been by scores, perhaps lots of, of management adjustments in our manufacturers over the many years.”
Now, Flynn desires to develop inside the Planet Health system and look into different “adjoining, consumer-facing manufacturers.”
“It’s a really large world of consumer-facing franchise working companies on the market,” he stated. “It covers not simply health, however well being and wonder companies and residential companies and automotive companies and hospitality.”
Flynn owns, however doesn’t function, 121 motels—109 of that are franchised. “I feel it’s logical and certain that we’ll ourselves turn into owner-operators of those hospitality property,” Flynn stated. “I don’t see why we shouldn’t. That’s a logical subsequent step for us.”