Singaporean casual dining brand, 4FINGERS has acquired a 50 per cent stake in Mad Mex Fresh Mexican Grill, a deal that will see new expansion rollout in the coming months.
On Wednesday, Inside Franchise Business reported that Mad Mex had been placed on the market through Allunga Advisory in an attempt to attract new investors.
4FINGERS moved swiftly, recognising growth potential in a partnership with the Australia franchise brand, joining forces in a deal that will see the group’s combined system-wide revenue projected to reach in excess of S$120 million for FY19.
The news comes following consistently strong earnings reports from Mad Mex, which achieved 4 per cent + like-for-like sales growth over the past two quarters, in strong contrast to the structurally challenged food and beverage marketplace.
The latest deal sees 4FINGERS continue to diversify its global portfolio, with the partnership expected to boost Mad Mex’s international expansions through Southeast Asia.
A number of potential locations in both Singapore and Malaysia have been shortlisted by 4FINGERS as primary targets for Mad Mex’s international rollout.
Clovis Young, Mad Mex founder and former majority stakeholder will remain as CEO, retaining a 50 per cent stake in the business, as the brand continues growth in the domestic market.
Young said the brand was excited to be partnering with a renowned global brand that aligned with Mad Mex’s firm focus on the customer service and quality.
“I started Mad Mex in 2006, because I absolutely love Mexican food. But there is a lot of Mexican food out there, and to be honest it’s mostly mediocre,” Young said.
“I wanted my customers to get a fast meal, but with homemade quality, made entirely of real ingredients, with the fewest preservatives, oils, and sugars possible. You should never have to choose between a quick meal and quality healthy food”.
The brand acquisition will enable the group to continue to aggressively scale up its management bandwidth, leveraging a combined network of supply chain processes, shared services and other scale economies.
Vijay Sethu, director of 4FINGERS said the acquisition of Mad Mex marked a significant milestone in the group’s growth strategy.
“We are very excited with our investment in Mad Mex and look forward to working with Clovis to further grow this business in Australia and New Zealand and to rollout the Mad Mex brand in Asia.”
“Mad Mex is the second key brand in the 4FINGERS Group. We are currently on the lookout for a third brand to complete this platform; a brand with similar characteristics to 4FINGERS and Mad Mex – strong, established, profitable and fast-growing that is easily scalable and has global potential”.
Management within the 4FINGERS team will also be bolstered to support regional and international growth opportunities, with over 20 new support-office members set to be added to the finance and accounting, HR, purchasing, IT and marketing branches of the Singapore and Kuala Lumpur headquarters.
4FINGERS will also continue to focus on growing its flagship brand, with the brand’s maiden U.S. outlet set to open in Los Angeles, California in Q4, 2018.