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Fifth Third Bank Supports Private Equity Buyout of 16 Five Guys Franchises

September 19, 2018, 08:39 AM
Filed Under: Restaurant

Hyde Park Ventures, a private investment management company, announced the acquisition of 16 Five Guys franchises across New England making it the third largest Five Guys franchisee in the United States. In total, Hyde Park now owns 32 Five Guys franchises in Massachusetts, Maine, Vermont, and Rhode Island with several more in development. Hyde Park operates one of the highest performing restaurant portfolios in the Five Guys system with the exclusive rights to develop 27 additional stores across New England in the coming years.

Through this acquisition, Hyde Park continues its mission to build a cutting-edge franchise platform within the Five Guys system, and eventually beyond.

Fifth Third Bank provided the debt financing for the transaction.

Hyde Park Managing Partner Greg Vasey founded the firm while an MBA student at the University of Chicago, where he met co-founder, Jody Goehring. During his time there, he discovered fragmentation and an under valuation of assets in the franchise sector. "The economic environment from 2007-2009 was devastating to traditional investment vehicles, and even the successful growth stories were absent significant cash flow. Franchising was a low-pressure weather system into which high pressure capital simply had to flow. The only question was where and how to create an investment vehicle to capture this valuable dynamic," said Vasey. "Ultimately, we chose Five Guys given its position in the 'better burger' market, its cost-efficient development model, and its premium product offering that consumers love," he said. 

For two years running, Five Guys has been voted America's favorite burger chain, according to Harris Poll's 30th annual EquiTrend study. It was also recently named in Forbes' 2018 Best Employers for Women.

Hyde Park approaches the market as a hybrid investor/operator, and sources its equity capital exclusively from high net worth investors, family offices and asset managers, all of which are attracted to the stability and cash flow profile of franchise businesses. Jody Goehring, Hyde Park Managing Partner, said: "Hyde Park provides private investors a direct opportunity to invest in a team uniquely experienced in operations, financial structuring and M&A, enabling its Limited Partners to bypass layers of private equity fees. Our existing investments validate an ability to create tangible value for investors, and we're just getting started."

"Hyde Park has built a very successful portfolio quickly, and proven their ability to create a scalable model, hire the right talent, and invest in the right deals," said Greg McGinley, vice president and corporate banking principal at Fifth Third. "We saw the opportunity to back a young investment team with a clear focus, and a top team in place. We look forward to supporting the Company's continued growth."


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