New PE Firm McWin to Buy Germany’s L’Osteria Casual Dining Chain | Franchise Mergers and Acquisitions

Young private equity firm McWin agreed to buy a majority stake in L’Osteria, a German-based casual dining restaurant chain with 157 stores operating in seven additional countries in Europe. The transaction values ​​L’Osteria at 400 million euros.

Klaus Rader and Friedemann Findeis, founders of L’Osteria, say their vision is spreading “the joy of Italy, everywhere for everyone,” and McWin’s investment will be used to fuel growth, said Harry Goss, partner and head of food service at McWin .

“It’s sort of bang-on casual dining. It’s large box, 200, 300 covers, which is large in Europe. It’s very much affordable, value for money, large portions,” with the slogan “the pizzas are so big they fall off the plate,” Goss said. “They’re usually quite loud and lively. They’re almost always packed and with a little queue out the door.”

Casual dining chains are rare in Europe. “In the US, something like 40, 45 percent of full-service restaurants are chains. In Germany, that’s 8 or 9 percent, so there’s a huge amount to do,” he said, meaning many opportunities to grow in Europe.

“The business has performed super well during 20 years of private ownership by the founders, it managed well through COVID,” he said. “It’s got a great team, excellent management, an excellent franchise network in Germany and outside of Germany, in seven or eight markets. It’s a great business.”

Expansion targets are unlikely to include the United States, though, because of so many established brands. “The graveyard is littered with European concepts that have foolishly thought they could succeed in the US” he said.

Founded by Henry McGovern and Steve Winegar (the firm name is a surnames mash-up), McWin raised its first fund, between 250- and 300-million euros, a year-and-a-half ago; its second fund last August, for 525 million euros; “And we’re raising a third fund at the moment,” Goss said, this one aimed at food technology such as plant-based meat and disposable packaging.

McGovern is the founder and former CEO of AmRest Holdings, which under his leadership grew to more than 2,300 restaurants in 25 countries with 55,000+ employees. Winegar was shareholder and senior executive of Grupo Zena and the founder of Restauravia Grupo Empresarial, Megafood SL and former board member of Telepizza.

Goss, based in London, was an investment banker doing mergers and acquisitions in foodservice and hospitality, and McGovern and Winegar are “old friends of mine” who offered him a chance to join McWin. “I couldn’t say no,” he said.

“We are very much a sector-focused fund, and it’s not the biggest sector in the world, so we made an effort to set ourselves up in a way that we can look at very small to very big,” he said, referring to transaction size.

Last year, for example, they invested in a brand incubator in the UK called White Rabbit Projects. “They’ll take two stores, and take it from two stores to 20. We’re not set up to do that, so we’re kind of investing in them to do it,” Goss said. “And then we can do a 400 million euros casual dining deal as well. We’re making a point of doing everything in between.”

In September 2022, McWin purchased BK SEE Poland SA and become Burger King’s master franchisee in Poland, with an agreement to build 200 restaurants. In November, McWin announced deals to bring Burger King to Czech Republic, Poland and Romania and Popeyes to Czech Republic and Poland, for 600 restaurants total over 10 years.

Other investments include Gail’s, CookUnity and Dean&David, as well as alternative protein companies BlueNalu, Perfect Day and Impossible Foods.