A Canadian company has bought Minnesota’s biggest name of barbecue, the famous Davis, for $200 million
The most popular barbecue chain in Minnesota is becoming Canadian.
MTY Food Group Inc. buys Based in Montreal, the company that owns the Famous Dave barbecue chain in a $200 million deal announced Tuesday.
Jeff Crivello, chief executive of BBQ Holdings, said the company’s Minnetonka office and its 75 employees will remain, and he expects to remain in the position.
The founder of Famous Dave Anderson is still an advisor. In an interview Tuesday, he said that chain-style spareribs and Texas beef will stay true to his recipes.
“Dave celebs don’t happen in the corporate office,” Anderson said. “The spirit of Dave’s celebrity is already in the restaurant.”
BBQ Holdings Inc. will become Minnetonka-based subsidiary of MTY, which is paying $17.25 per share, about 40% above BBQ’s closing price on Monday. When the transaction is completed, BBQ Holdings shares will be delisted from the Nasdaq.
As a subsidiary of MTY, Crivello expects BBQ Holdings to continue acquiring new chains, filling unused capacity with ghost kitchens, and developing Famous Dave’s with locations smaller than traditional sit-down restaurants.
“Our business model has always been growing from three different angles,” he said.
When Crivello joined Famous Dave’s as CEO in late 2017, the company saw a parade of six CEOs in five years. Its share price was around an all-time low of about $3.65.
Since then, the company has survived the pandemic shutdown by switching to takeout, phantom kitchens and financial assistance from the government. Its stock reached a five-year peak of about $18 in June 2021.
The company said Tuesday that its adjusted earnings for the three months ended July 3 were 31 cents per share, up from 18 cents a year earlier. Revenue rose 76% to about $80 million, reflecting the return of the pandemic.
Prior to becoming CEO, Crivello worked as a CFO at PW Partners Capital Management, a hedge fund that subsequently acquired about $1.5 million in Famous Dave stock in 2017. Shortly after joining Famous Dave’s, he began consulting with its founder Anderson on ways to enhance their appeal.
“Jeff is the only one who has been able to change the current restaurants,” Anderson said. “He made the hard decision when restaurants weren’t making the decision to close and he knew he had to restructure the big boxes into smaller boxes that are more lightweight.”
BBQ Holdings now operates more than 200 franchised restaurants and more than 100 corporate-owned restaurants across 37 states in the United States, Canada and the United Arab Emirates. The company has purchased several other franchise chains in recent years, including Baker’s Square, Barrio Queen, Granite City, Tahoe Joe’s, and Village Inn.
MTY is a franchisor of nearly 80 restaurant brands — including Papa Murphy’s, Cold Stone Creamery and Planet Smoothie — with 3,900 locations in the United States, and takes revenue from another 3,000 or so restaurants in Canada and other parts of the world.
“We are excited about the prospects for adding the BBQ Holdings brands to the MTY family, and we look forward to welcoming Jeff Crivello, his team and their franchisees,” said Eric Lefebvre, CEO of MTY, in a statement.
Anderson opened his first celebrity dave in Hayward, Wisconsin, in 1994. He left the company in 2002 when President George W. Bush appointed him as Assistant Secretary in the Home Office of Indian Affairs.
In recent years, Anderson has focused on another barbecue concept named after his father, called Jimmie’s Old Southern BBQ Smokehouse. It has locations in Minneapolis and Wisconsin.
Anderson sees the change in ownership of Famous Dave as part of the trip. “For me, it’s like watching your son or daughter graduate college and you just have hope for the future,” he said.