Arby’s parent company, Inspire Brands, is acquiring burger chain Sonic.
Inspire Brands announced Tuesday that it was buying the burger brand for $2.3 billion including debt.
At $43.50 per share the acquisition will amount to $1.57 billion in cash. The deal represents a premium of roughly 19% per share versus Sonic’s closing stock price on Monday.
Sonic — known for its burgers, quirky menu items, and extensive beverage options— is the largest drive-in chain in the US with more than 3,600 locations. The chain will continue to operate as an independent brand out of its Oklahoma City headquarters.
Inspire Brands was formed in February after Arby’s acquisition of Buffalo Wild Wings. With the deal, Inspire Brands’ portfolio, which includes Arby’s, Buffalo Wild Wings, and Rusty Taco, will comprise more than 8,000 locations with combined system sales exceeding $12 billion, according to figures provided by the company.
“Sonic has had a significant focus on innovation, especially in guest-facing digital technologies,” Inspire Brands said in a statement. “In addition, its menu — especially its beverage innovation — is truly unique. Each of these areas are great growth opportunities for Inspire’s current brands.”
Sonic rolled out mobile ordering across the US this summer. The chain is known for iconic menu items such as its Cherry Limeade, Ocean Water Slush, and Coney hot dog, as well as new innovations like this summer’s Pickle Juice Slush.
“We can leverage all these extreme types of things, when other brands can’t,” Scott Uehlein, Sonic’s vice president of product innovation and development, told Business Insider last week.
Earlier this year, Inspire Brands CEO Paul Brown told Business Insider that the company was looking to acquire more brands that would serve distinct customers.
“Up and down the spectrum, even in QSR, we would want the brands to be as complementary as possible,” Brown said. “You don’t want brands that are right on top of each other. It’s harder from an internal standpoint. You want to keep lines between the brands. If they get too close together, it gets harder to manage.”
The deal is expected to close by the end of this year.