One Group Hospitality Signs Deal for Kona Grill
The ONE Group Hospitality Inc. has struck a deal to acquire the remaining 24 of Kona Grills restaurants for approximately $25 million.
Kona Grill filed for Chapter 11 bankruptcy in April after shutting the doors at about half of its locations over a two-year period, according to Wall Street Journal.
The final purchase price will be determined at the closing of the transaction based on the completion of due diligence, subject to certain agreed upon adjustments.
If approved the deal would include the remaining 24 of Kona’s domestic restaurants and assume certain contracts, including two international franchise licenses, for approximately $25 million in cash plus the assumption of working capital liabilities of approximately $11 million. If completed, the company expects the integration to take approximately 12 months.
“Kona Grill is an excellent brand that has maintained a strong position in the remaining 24 restaurants where it operates due to its elevated dining experience, contemporary, freshly prepared food, award-wining sushi, and specialty cocktails. Through this transaction, we believe we can leverage our corporate infrastructure and operating expertise, particularly our bar-business know-how and VIBE dining, to drive improved performance in many of the same ways we have substantially improved comparable store sales and overall profitability at STK,” said Emanuel “Manny” Hilario, President and CEO of The ONE Group.
“The acquisition of Kona Grill also provides us with a complementary concept to STK, potentially creating another long-term growth vehicle once we fully integrate the restaurants into The ONE Group. The remaining 24 domestic restaurants, down from 40 at year-end 2018, reflect a strong base of high performing restaurants in attractive markets. We look forward to maximizing the multiple opportunities that this acquisition will provide to create long-term shareholder value,” added Hilario.
This is the second deal in recent months for the struggling full-service restaurant chain. Williston Holding announced its intent to acquire Kona Grill earlier this year for $20.3 million but withdrew its offer.