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AFC UPDATE |
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AFC Enterprises Announces Exploration of Strategic Alternatives for Cinnabon |
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ATLANTA, April 20 /PRNewswire-FirstCall/ -- AFC Enterprises, Inc. (Ticker: AFCE), the franchisor and
operator of Popeyes® Chicken & Biscuits, Church‘s Chicken™, Cinnabon® and the franchisor of Seattle‘s
Best Coffee® in Hawaii, on military bases and internationally, today announced its intention to explore
strategic alternatives with respect to its Cinnabon subsidiary, including a possible sale, as part of AFC‘s
continued effort to sharpen its strategic focus and maximize shareholder value. Cinnabon also owns the
international franchise rights for Seattle‘s Best Coffee in eleven countries, Hawaii, and U.S. military
bases, which is also expected to be part of any transaction. The Company‘s Board of Directors has
engaged Bear, Stearns & Co. Inc. to advise it in connection with the exploration of strategic alternatives
for Cinnabon, including a possible sale.
Cinnabon‘s continued growth primarily in traditional retail locations such as malls, airports and travel venues has resulted in 617 system-wide bakeries as of February 22, 2004. In addition, Cinnabon has increasingly leveraged its strong brand equity to expand into the consumer products and food categories through licensing. Most recently, Cinnabon entered into licensing agreements for Betty Crocker® Cinnamon Streusel Muffin Mix, Orville Redenbacher‘s® gourmet popcorn, Lotta Luv LLC lip gloss and lip balms, and Sun-Maid® Raisin Bread. Cinnabon has executed its licensing strategy through the mass merchandising, club store and grocery distribution channels with major retailers such as Wal-Mart, Target, Costco and Sam’s Club. In 2003, Cinnabon had over 10,000 of these distribution outlets selling Cinnabon licensed products. Frank Belatti, Chairman and CEO of AFC Enterprises, stated, “The action announced today illustrates AFC‘s ongoing commitment to refine and focus our business model. Since AFC acquired Cinnabon in October 1998, Cinnabon has pursued growing its business through retail franchising while identifying and leveraging other areas of growth through its licensing initiatives. We believe that the value of Cinnabon will be maximized by positioning the brand to take full advantage of such potential future growth opportunities, and we will be exploring alternatives to do so.” There can be no assurance that the Company will implement any strategic alternatives for its Cinnabon subsidiary. Corporate Profile
AFC Contact Information:
Certain statements in this AFC Update are “forward-looking” statements within the federal securities laws and |
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