Nathan's Famous Reports Sale of NF Roasters Corp.
May 2, 2008
Nathan's Famous, Inc. Reports Sale of NF Roasters Corp.
WESTBURY, N.Y.--(BUSINESS WIRE)--April 28, 2008--Nathan's Famous, Inc., announced today the sale of its subsidiary, NF Roasters Corp., to Roasters Asia Pacific (Cayman) Limited, its Master Developer of franchised Kenny Rogers Roasters restaurants in Malaysia and certain other foreign territories. The purchase price was approximately $4,000,000 in cash plus certain accruals.
In connection with the sale, NF Roasters Corp. entered into a license agreement with a subsidiary of Nathan's, pursuant to which NF Roasters Corp. licensed to the Nathan's subsidiary certain intellectual property necessary for Nathan's to continue to make available "Kenny Rogers" products at existing Nathan's Famous and Miami Subs restaurants.
I can't help but feel that Nathan's management is refocusing the business to the point that they are only dealing with the Nathan's brand. This move doesn't rid the company of a whole lot but it does seem to give them less to worry about while giving them the option to use Kenny Rogers products. This press release is very brief so we may not yet have all the details. But given that last June Nathan's sold its Miami Subs subsidiary, they may be moving in the direction of primarily dealing with Nathan's franchisees and expansion rather than other subsidiaries and projects. As long as management has a clear focus and objective, I'm all for it. Hopefully we'll get some more thoughts from management in the upcoming earnings release.
I remain very interested in Nathan's and am tempted to add to my position given the stock has slowly gone down over the past few months to $13 or so. However, before I add to my position I need some confirmation from management that they do have a plan going forward. Nathan's has a strong balance sheet of $33 million+ in cash with no debt, fuels growth through its own cash flow, but I don't get the feeling that management exactly knows how to expand the company. So this is what I'm looking to get an answer to going forward. And there's also so many great opportunities out there today; Famous Dave's at $9.00, Hansen at $35, Middleby in the low $60's, Chipotle in the $80's, and I'm also wanting to get some exposure to the railroad industry. So basically there are no guarantees as to what I will buy next.
Tags:
hot dogs, nathans famous, pencils fund, restaurants
Posted at: 10:06 AM | Add Comment
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