Sagittarius Brands, Parent Company Of Captain D's Seafood, Signs Agreement To Acquire Del Taco

NASHVILLE, TENN (Thursday, February 02, 2006) - Sagittarius Brands, the parent company of Captain D's Seafood, has signed a definitive agreement to acquire Del Taco. Del Taco, headquartered in Lake Forest, CA, is the nation's second largest Mexican quick-service restaurant chain. Captain D's, headquartered in Nashville, TN, is the nation's second largest seafood quick-service restaurant chain.

Veteran international restaurant chain operators Sid Feltenstein, Chairman of Sagittarius Brands, and Ron Powell, President and CEO of Sagittarius Brands, announced the transaction. Private equity investors in the acquisition are Grotech Capital Group, Charlesbank Capital Partners, Leonard Green & Partners, LP and Stockwell Capital, LLC. Terms of the transaction were not released but, according to Feltenstein, the transaction should be completed within 60 days.

Feltenstein and Powell, who have been instrumental in the growth and eventual sale of other major international quick-service restaurant brands, said the transaction would give Sagittarius Brands more than 1,000 units across the United States and system-wide sales in excess of $1 billion annually.

"We are very excited about adding Del Taco to the Sagittarius Brands family. The Mexican quick-service category continues to show positive growth, and this acquisition will bring together two companies that are very strong in their respective categories and geographies, with locations in complementary regions of the country," Feltenstein said. "We believe that we have great potential to leverage the growth of both brands on a stand alone basis and through multi-branding."

Kevin K. Moriarty, Chairman and CEO of Del Taco said, "We believe this deal with Sagittarius Brands will give Del Taco strong growth opportunities that will benefit the brand, our employees and our franchise community. Sid and Ron are experienced restaurant operators with an excellent track record. I'm more than comfortable turning over Del Taco's helm to this team."

Founded in 1964, Del Taco is the nation's second largest Mexican quick-serve chain with annual unit volumes that exceed $1.2 million. Moriarty took the reins at Del Taco in 1990 and the company has since posted fifteen years of consecutive same store sales growth. In 2005, Del Taco opened 34 new restaurants, which included new markets such as Michigan, Idaho, and Oregon. In addition to new company store growth, Del Taco currently has sixty franchise development agreements in place to open 338 new restaurants over the next five years.

"This transaction will enable both companies to expand their popular and successful concepts into new and existing markets, while at the same time allowing our franchise and company-owned stores to capitalize on the growing seafood and Mexican segments through multi-branding," explained Powell. "It's a perfect marriage of a company that has pioneered the seafood quick service dining category with restaurants primarily in the south and southeast, and a company that is a pioneer in the Mexican category primarily in the western states. There will be significant personal growth opportunities for employees and franchisees of both systems and greater combined purchasing power for the emerging multi-brand organization."

Founded in 1969, Captain D's offers customers a menu of seafood featuring its signature dish of hand-cut and hand-battered fried fish along with baked or broiled fish, shrimp, chicken and home style dishes. There are over 600 Captain D's restaurants in 26 of the United States and the Caribbean, plus military bases around the world. Additional information is available at www.captainds.com.

Founded in 1964, Del Taco operates or franchises more than 450 restaurants in 13 states. Del Taco offers a full range of made-to-order Mexican items such as tacos, burritos, quesadillas and American favorites including cooked-to-order burgers, fries and shakes. Del Taco uses fresh ingredients including hand-made salsa, fresh produce, freshly grated cheddar cheese, chicken grilled every hour and lard-free beans made from scratch. Additional information is available at www.deltaco.com.

SOURCE: Sagittarius Brands

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