Industry News | June 22, 2000
Smoothie King Acquires Frozen Fusion Locations
"The benefit of acquiring these assets will come from gaining access to Frozen Fusion's high caliber locations, many of which are in markets we already targeted as part of our expansion strategy," said Steve and Cindy Kuhnau, co-founders of Smoothie King. "We were already actively seeking expansion in those areas [the Southwestern and Northeastern United States] and this acquisition allows us to move into those markets with prime locations that are already up and running."
Frozen Fusion and its parent company, Native Planet Foods (NPF) of Scottsdale, Arizona, evaluated proposals from several other operators before deciding to join forces with Smoothie King. "Our long term strength as a growing business was attractive to NPF," said Kuhnau, "because they wanted to be investors in a company that has staying power in the marketplace." NPF had been a majority shareholder in Frozen Fusion since the company's inception in 1996. Under the terms of the agreement, Smoothie King will transfer stock in exchange for Frozen Fusion locations, making NPF a long-term investor in Smoothie King.
"This was a win-win agreement for both companies," said Bob Lind, managing partner of Berkshire Bridge Capital, the Pasadena, California-based advisory firm that represented Frozen Fusion and NPF in the transition. "Smoothie King will benefit from the outstanding locations that Frozen Fusion developed over the years and NPF has acquired an investment presence in a company that has a proven track record and a strong future."
Under the conditions of the agreement, Frozen Fusion franchisees will be given the opportunity to convert to the Smoothie King system and receive all necessary training and support to do so. "We anticipate that most of the locations will be converted [to Smoothie King] within the next 30 to 60 days," says Joe Lewis, president of Smoothie King. "Frozen Fusion has done a very good job of positioning their concept and developing good locations and establishing customer goodwill. All of this will benefit greatly our expansion into these targeted markets."
Smoothie King specializes in over 40 different kinds of natural drinks, each made from a unique blend of fruits, natural juices, and other nutritious ingredients. Founded in 1973, Smoothie King began franchising in 1989.
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