Chuck E. Cheese Considers Potential Acquisition, Valued at Over $1 Billion

Estimated read time: 4 minutes and 11 seconds

CHARLES ENTERTAINMENT CHEESE

Chuck E. Cheese Considers Potential Acquisition (Read More)

CEC Entertainment: Chuck E. Cheese, the popular entertainment company, is reportedly exploring a potential acquisition as it taps Goldman Sachs. Private equity firms and peers like Dave & Buster’s could be potential suitors, with the deal possibly exceeding $1 billion.

Financial Performance: Chuck E. Cheese ended 2022 with approximately $348 million in sales and 475 U.S. locations. Its parent company, CEC Entertainment, also operates international Chuck E. Cheese locations, Peter Piper Pizza locations, and virtual Paqually’s Pizza & Wings locations.

Past Challenges: Chuck E. Cheese faced difficulties in recent years, including failed attempts to merge with Leo Holdings Corp. and go public in 2019. The company also filed for Chapter 11 bankruptcy in 2020 but emerged in 2021.

New Initiatives: After emerging from bankruptcy, Chuck E. Cheese has made significant changes, hiring new executives, partnering with Virtual Dining Concepts for a LankyBox Kitchen concept, and launching a new "grown-up menu" featuring new pizzas, wing sauces, meatballs, and cakes.

🧠 EDITOR’S THOUGHTS

I had some of my favorite childhood memories at Chuck E. Cheese, especially on birthdays. A lot has changed, including removing the ball pits and going tokenless. I’m honestly glad they’re still around and have adapted throughout the years.

History: Chuck E. Cheese's has evolved significantly since its inception in San Jose, California, debuting its first location in 1977. Atari co-founder Nolan Bushnell developed the concept.

Parent Company: In 2014, Chuck E. Cheese's was acquired by an affiliate of Apollo Global Management. Then, in 2020, Monarch Alternative Capital took over after the pandemic nearly crushed it to bankruptcy.

Adaptation: Chuck E. Cheese's has adapted to changing times and consumer preferences, incorporating technology into its arcade games and offering diverse menu options beyond pizza to cater to varying tastes and dietary preferences.

Chuck E. Cheese Locations 

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NET LEASE NUGGIES

• Jaggers, Texas Roadhouse's Quick-Service Concept, Shows Promise with Growth Jaggers, a quick-service restaurant brand under Texas Roadhouse, has been slowly expanding its presence since its creation in 2014. With just eight current locations, the concept is picking up pace and aims to have as many as 15 open by the end of next year. Offering made-from-scratch burgers, chicken tenders, and sandwiches, Jaggers has seen increased sales and margin performance, especially during the pandemic. Texas Roadhouse has signed its first franchise development agreement for Jaggers, with plans for additional openings in 2024. (Read More)

• Captain D's signs franchise development agreements in New Jersey and Georgia. The fast casual seafood restaurant is partnering with experienced business leaders to open new locations. Multi-brand franchisees Jujhar Rai and Maliha Rahmani will convert a former Church's Chicken in Camden, New Jersey. Farid Khan will develop three Captain D's in the Atlanta area, starting with a former Hardee's. Captain D's has been successful in repurposing existing buildings, with 50% of new openings in the past year being conversions. With over 530 restaurants in 23 states, Captain D's is rapidly expanding its franchise opportunities. (Read More)

• Dave's Hot Chicken to Open Six New Locations in North and South Dakota Dave's Hot Chicken franchisee Dusty Jensen is expanding in the upper Midwest with a multi-unit deal to open six new Dave's Hot Chicken locations in North and South Dakota. Jensen, who currently operates other restaurant concepts, partnered with Myron Thompson for this venture. The duo chose to introduce the Los Angeles-based hot chicken concept to the two states, starting with their first unit in Fargo, North Dakota, in mid-2024. Dave's Hot Chicken, known for its flavorful tenders and Nashville hot spice levels, has experienced rapid growth and plans to open about 100 more locations in 2024. (Read More)

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