Michigan-based Buddy’s Pizza received a significant investment from CapitalSpring, the company announced Wednesday. The private-equity firm, which is focused exclusively on the restaurant industry and has worked with brands like Taco Bell and Denny’s, said the partnership will recapitalize the company and accelerate new store growth across the Midwest and beyond. Terms of the deal were not disclosed.
Founded in 1946, Buddy’s has 12 restaurants throughout Detroit and the surrounding area. It claims to have originated Detroit-style pizza, which is prepared in square, blue steel pans originally used to hold nuts and bolts on Detroit’s automotive assembly lines. The brand is known for its signature square pie. Buddy’s is also preparing to open its 13th location, a full-service eatery at the Detroit Zoo, in the spring.
“We are thrilled to support the Buddy’s team and look forward to working together to grow the brand over the coming years,” said Erik Herrmann, managing director at CapitalSpring in a statement. “It’s rare to find a restaurant concept with such signature food, deep-rooted brand equity, and passionate customers, and we are honored to be their partner in accelerating the business.”
CapitalSpring currently manages assets in excess of $1.3 billion and has completed investments in more than 50 restaurant brands and 4,000 restaurant locations. In August, the firm took a majority stake in FSC Franchising Co. LLC, the franchisor of Beef ‘O’ Brady’s and The Brass Tap.
“This partnership is a significant opportunity for us to introduce Buddy’s iconic pizza, rich culture and community roots to new customers in Detroit and beyond,” said Robert Jacobs, CEO of Buddy’s, in a statement. “We are extremely excited for this new chapter and to have found a partner that can not only maintain our commitment to quality food and an exceptional guest experience, but also offer substantial restaurant expertise.”
Deloitte Corporate Finance, LLC served as lead financial adviser, and Jaffe Raitt Heuer & Weiss served as legal advisor to Buddy’s in connection with the transaction. CapitalSpring was represented by Latham & Watkins and Federman Steifman.