Valora buys Frittenwerk

Swiss travel expert Valora has bought the German fast casual concept Frittenwerk.
Swiss travel expert Valora has bought the German fast casual concept Frittenwerk.

The Swiss transport location specialist Valora acquires the French fries format Frittenwerk and thus becomes active in the German fast-casual market. In this way, Valora intends to take the next strategic step in the development of its food service business, the majority of which is take-away, in the direction of experience gastronomy with familiar self-service processes. What are the Group's specific plans for Frittenwerk?

"With Frittenwerk as an established brand, Valora intends to expand further in this fast-growing restaurant segment and benefit from market developments. The Frittenwerk founding team is also convinced that, in association with Valora, it will be able to further strengthen the brand and accelerate growth," it said in an initial statement.

Valora continues to develop its food service portfolio and is tapping into a new market with the acquisition of Frittenwerk. "The German fast-casual market grew by an average of 9 percent annually between 2016 and 2019, significantly outperforming the overall out-of-home market (+3%)," the Swiss company said.

Known as a first mover

Frittenwerk has focused on modern interpretations of the Canadian snack classic poutine since its founding in late 2014, and its menu is all about fancy frites. As a first mover, the French fry manufactory has high potential for further scaling, Valora finds. The concept held its own during the Corona crisis, it says, and also expanded vigorously during the pandemic years, adding 12 new locations. "This expansion can be increasingly continued in conjunction with Valora. Valora plans to double its current 27-location network by 2025," the announcement said.

Structure of Frittenwerk

The Frittenwerk currently has a majority presence in city centers, but also in shopping malls and in train stations in large and medium-sized German cities. The still young location portfolio is secured by long-term lease agreements. Most of the Frittenwerk restaurants are operated as self-owned businesses, while a good fifth are run by private and institutional franchise partners.

Valora sees additional growth opportunities, particularly in high-frequency locations, via take-away sites with low space requirements. Expansion abroad is also conceivable. Thanks to uniform system standards and low complexity, Valora believes that the concept can be easily developed further.

Expansion of the multi-format strategy

"The acquisition of Frittenwerk is a logical step in the expansion of our growth-oriented multi-format strategy," says Michael Mueller, CEO of the Valora Group. "Frittenwerk is a popular, strong brand in Germany and has a High level of innovation in the restaurant business, but also in terms of digitalization. We are convinced that Valora will quickly gain a foothold in the fast-casual market with this format and benefit from the attractive market development. We also expect the Frittenwerk, as a creative unit, to provide a significant transfer of know-how and expertise to our other formats."

Also the Founding team of Frittenwerk (Mateo Skendo, Keydi Skendo and Mey Nguyen) as the previous owner is convinced that both parties will benefit from the merger and together lift the brand to a new level with tailwind. In order to maintain its own brand strength and thus drive expansion in a targeted manner, the frit plant is to be managed as decentrally as possible within Valora's Food Service division in the future. The founding team will remain on board, according to the statement. The existing employees will also be retained. The Frittenwerk headquarters will remain in Düsseldorf.

The takeover of Frittenwerk is expected to take place on July 1, 2022. The parties have agreed not to disclose the terms of the takeover. It will be financed from existing financial resources.

In 2021, the format generated external sales of EUR 19 million and EBITDA of around EUR 2.5 million, according to foodservice Top 100. Valora expects EBITDA to more than triple by 2025 as it scales up.

About Valora:
Valora 's 2,700 or so small-outlet outlets are located at high-frequency sites in Switzerland, Germany, Austria, Luxembourg and the Netherlands. The company's brands include k kiosk, Brezelkönig, BackWerk, Ditsch, Press & Books, avec, Caffè Spettacolo and the popular own-brand ok.- as well as a steadily growing range of digital services. Valora also operates one of the world's leading producers of pretzel pastries and benefits from a highly integrated value chain in the baked goods sector. Valora generated external sales of CHF 2.2 billion in 2021. The Group is headquartered in Muttenz, Switzerland. The registered shares of Valora Holding AG (VALN) are traded on the SIX Swiss Exchange AG.