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An Atlanta-based company that already operates Church’s Chicken restaurants has announced it is acquiring Shoney’s Restaurants for an undisclosed amount.
Royal Hospitality Corp., an affiliate of Royal Capital Corp., said it will take over all 282 Shoney’s restaurants from Shoney’s LLC.
The restaurants will continue to be called Shoney’s, and the corporate headquarters will remain in Nashville.
David Davoudpour, founder and CEO of Royal Capital, is now the chairman and CEO of Shoney’s North American Corp., effective Monday.
“We all believe that Shoney’s can be an even greater brand and can and will return to its glory days as an exciting food destination for millions of satisfied customers across the United States,” Davoudpour said in a statement.
Royal Capital is the largest franchisee of Church’s Chicken with 112 restaurants located in Arizona, California and Texas, according to Royal spokeswoman Claudia D’Avanzo.
Shoney’s LLC was owned by an affiliate of Dallas-based investment firm Lone Star Funds.
The once-popular restaurant chain known for its breakfast bar has 282 locations in 18 states, 230 of which are owned by franchisees.
Royal Hospitality, formed in 2004, now owns all trademarks and franchise rights to the Shoney’s brand. It expects to complete the acquisition of the 52 company-owned Shoney’s by the end of the month.
“This is a new day for Shoney’s, and we welcome Mr. Davoudpour and his team and are proud to be working with them,” said Dan Dahlen, Shoney’s chief marketing officer.
Shoney’s, begun in 1947 with a restaurant in West Virginia, merged with Danner Foods of Nashville in 1971 to become Shoney’s Big Boy Enterprises. It became Shoney’s Inc. five years later.
Shoney’s had solid sales and growth for decades before faltering in the 1980s when customers complained of poor food and service.
The company sold off noncore operations such as its Pargo’s and Fifth Quarter chains and closed some of its Shoney’s locations.
The Lone Star Funds affiliate took the company private in 2002 after nearly 30 years of public trading. At the time, the chain owned or franchised close to 1,000 Shoney’s restaurants in 28 states, and it operated or franchised more than 560 Captain D’s seafood restaurants.
Lone Star sold off the Captain D’s chain in 2005.
Brentwood-based Centrum Equities, a private equity firm, tried to buy Shoney’s last year, but then sued to get out of the purchase contract.
Staff photo by Matt LeBlanc * Tri-Parish Times * Shoney’s Houma restaurant, located on Martin Luther King Boulevard, is one of 282 Shoney’s LLC properties Royal Hospitality Corp. is taking over. The Atlanta-based company now operates Church’s Chicken. Royal Hospitality now owns all trademarks and franchise rights to Shoney’s brand.
