Brazil Fast Food Announces Sale of Real Estate Assets
Brazil Fast Food Corp. (OTCBB: BOBS), the second largest restaurant chain with 737 points of sale, and operating in Brazil under the (i) Bob’s brand, (ii) KFC and Pizza Hut São Paulo as franchisee of Yum! Brands, and (iii) Doggis as franchisee of GED, today announced the sale of all real estate assets held by Venbo Comércio de Alimentos Ltda, the Company’s operating subsidiary, to Bigburger Ltda. and CCC Empreendimentos e Participações Ltda., entities controlled by Mr. José Ricardo Bomeny and Rômulo B. Fonseca, respectively, who are significant stockholders of the Company.
The Stockholders, through their controlled entities, acquired eight stores for a total consideration of R$13.5 million, including a down payment of R$2.8 million, with the balance to be paid in 24 monthly installments. The sale was completed on September 1, 2010.
The sale of Venbo’s real estate assets was approved on January 21, 2010, and ratified on June 29, 2010 by the Board of Directors, subject to a 30-day waiting period under Brazilian law to allow tenants the right of first refusal to acquire the stores. The real estate assets were subjected to third party evaluations from five different experts, with the final price based on the evaluation of Jones Lang LaSalle, a global real estate services firm, which based on recent comparable transactions estimated the assets to be worth approximately R$11.5 million. The buyers also accepted certain conditions to protect the long term interests of the Company, including the maintenance of existing rental agreements as well as loan guarantees, among others.
“This transaction will allow us to reduce our debt, strengthen our balance sheet, and focus management’s attention on our core restaurant operations”
“We are pleased to announce the sale of Venbo’s real estate assets which, we believe, creates value for all our shareholders,” said Mr. Ricardo Bomeny, the Company's President and CEO. “This transaction will allow us to reduce our debt, strengthen our balance sheet, and focus management’s attention on our core restaurant operations,” concluded Mr. Bomeny.
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