Jack In The Box To Buy Del Taco In About $575 Mln Cash Deal, Including Debt - Quick Facts

Jack in the Box Inc. (JACK), one of the nation's leading QSR chains, and Mexican QSR chain Del Taco Restaurants, Inc. (TACO), announced Monday that the companies have entered into a definitive agreement pursuant to which Jack in the Box will acquire Del Taco for $12.51 per share in cash in a transaction valued at approximately $575 million, including existing debt.

Founded in 1964, Del Taco serves more than three million guests each week at its approximately 600 restaurants across 16 states, with 99% of Del Taco restaurants featuring a drive-thru.

This transaction combines two challenger brands with complementary geographic footprints, guest profiles and menu offerings to create a scaled QSR player with a stronger financial model to drive growth and enhanced profitability. The transaction allows Jack in the Box to tap into the growing and attractive Mexican QSR category.

Jack in the Box expects the transaction to be mid-single-digit accretive to earnings per share excluding transaction expenses in year one and meaningfully accretive beginning in year two once full synergizes are realized.

Jack in the Box expects the combined company to realize run-rate strategic and cost synergies of approximately $15 million by the end of fiscal year 2023, with approximately half of the synergies achieved in the first year.

Jack in the Box intends to finance the acquisition through the issuance of additional securitization notes from its existing program with a financing commitment provided by BofA Securities, Inc.

The transaction is expected to close in the first calendar quarter of 2022 and is subject to customary closing conditions, including receipt of Del Taco shareholder approval and regulatory approvals.

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