Domino’s Pizza (DMP) shares had a strong day in yesterday’s generally weak trading session after it confirmed it was spreading its wings in France and boosting its presence in a $55 million purchase of a smaller rival.
The shares jumped 6.9% to $42.50 on a way when the wider market closed slightly lower after trading in the red for most of the session. That made the shares the best performers yesterday.
DMP 1Y – Domino’s eats up French pizza chain
Domino’s Pizza chief executive Don Meij said the company will strengthen its share of the French pizza market by acquiring independent chain Pizza Sprint.
Mr Meij said the company had entered into a binding agreement to acquire Pizza Sprint from owners Franck Guegan and Food Court Finance SRL, boosting the number of stores in France by 89 to 330.
The acquisition is expected to boost Domino’s earnings per share by about 4%.
Pizza Sprint had network sales of around $50 million in 2015 and earnings before interest, tax, depreciation and amortisation around $5.5 million.
The acquisition is expected to be completed in January 2016.
"Pizza Sprint is a small but important acquisition which allows DPE to capitalise on the forward momentum we have been able to achieve in our European business, particularly in the last few years," said Mr Meij.
"We continuously look for opportunities to grow, both within our existing business and through further acquisitions."
Mr Meij has also been looking at other Domino’s franchises overseas, including Korea, according to recent media reports.
