Pizza Hut Australia Under New Ownership as it Struggles Against Dominos

Pizza Hut Australia has recently undergone a change in ownership as it faces tough competition from its rival, Dominos. The master franchisee rights for all 260 Pizza Hut restaurants in Australia have been acquired by the United States-based Flynn Restaurant Group. This marks the group’s first international acquisition, adding to their portfolio of 2,357 restaurants in the US, including 945 Pizza Huts.

The acquisition was made through a deal with Australian private equity firm, Allegro Funds, for an undisclosed amount. Allegro Funds had purchased the fast food chain in 2016 and implemented a restructuring process before putting it up for sale. This acquisition presents a perfect opportunity for the Flynn Restaurant Group to expand its operations globally.

Ron Bellamy, the Co-Chief Operating Officer of the Flynn Restaurant Group, expressed enthusiasm about the acquisition, citing Pizza Hut Australia’s impressive track record of positive same-store sales growth and record revenues. He emphasized the importance of leveraging their scale and capabilities to support the continued success of Pizza Hut in Australia.

Pizza Hut Australia has a rich history, having opened its first restaurant in Belfield, southwest Sydney, in 1970. It quickly gained popularity as a go-to destination for both dine-in and takeaway dining. Notably, the company was one of the early adopters of pizza delivery in 1985. Over the years, Pizza Hut has established a solid foothold in the Australian market, currently holding around 10% of the market share and generating approximately $270 million in annual revenue.

The completion of the deal is contingent upon approval from Yum! Brands, the global owner of Pizza Hut, which is expected by the end of the month. Once finalized, this acquisition will strengthen Pizza Hut Australia’s position in the market, enabling them to continue providing exceptional experiences to their customers.

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Despite Pizza Hut’s recent growth, Dominos remains the dominant player in the Australian pizza segment. With their innovative use of technology, Dominos has managed to expand rapidly and now operates 757 stores across Australia, commanding 46% of the market. Dominos’ success can be attributed to its heavy investment in an advanced online platform and delivery system, allowing for quick and convenient service.

In contrast, Pizza Hut, which focused more on the dine-in experience, struggled to keep up with the technological advancements implemented by Dominos. In an attempt to compete, Pizza Hut underwent a major cost-cutting program. Unfortunately, this move resulted in a class action lawsuit in 2015, with most of Pizza Hut’s franchisees claiming that the cost-cutting measures had a negative impact on their businesses.

As the battle for dominance in the Australian pizza industry continues, the change in ownership for Pizza Hut Australia presents an opportunity for revitalization and growth. The Flynn Restaurant Group’s expertise and investment backing, combined with Pizza Hut Australia’s rich heritage, will contribute to the ongoing evolution of the brand.

For more information about Pizza Hut Australia, visit Hook’d Up Bar and Grill.