SPARTANBURG, S.C. — Denny’s Corporation (Nasdaq:DENN) today announced that it has been selected as the full-service restaurant operator of choice for Pilot Travel Centers LLC (Pilot), one of the nations largest retail operators of travel centers catering to the professional driver and traveling motorist in 41 states with over 300 retail interstate properties. Pilot is in the process of merging with Flying J Travel Centers (Flying J), subject to final approval by the Federal Trade Commission (FTC).
Up to 140 Flying J Travel Centers across North America could have their full-service restaurants converted to Dennys. Dennys expects to begin the Flying J conversions in the second quarter of 2010 and to have a majority of the conversions completed by year end. On an annualized basis these conversions are expected to add an estimated 7% to 8% to Dennys system-wide sales. Dennys franchisees will convert and operate most of the Flying J locations with the Company planning to convert and operate approximately fifteen of the restaurants. As previously communicated the capital outlay is expected to be approximately $525,000 per conversion. The parties expect existing employees will generally remain in place.
Pilot and Dennys have identified 50 existing and proposed Pilot Travel Centers as potential Dennys locations. These new travel centers and conversion opportunities will occur over the next several years as Pilot resumes its normal development pipeline.
Commenting on the potential venture, Nelson Marchioli, CEO of Dennys said: This is a meaningful opportunity for Dennys to expand the Dennys brand and provide further development options for our franchisees. Based on the success of our seven existing Pilot locations and four Flying J conversions, we expect this agreement will truly add long-term value for the Company, its shareholders and franchisees. We value the relationship we have developed with Pilot, and we have demonstrated that Denny’s enhances the experience for Pilots existing customers. The combination of our two brands is a natural fit and the performance of our initial locations has exceeded expectations. Developing restaurants along our nation’s highways has always been an important part of Denny’s heritage, and this relationship represents the culmination of many years of work.
Jimmy Haslam, CEO of Pilot, said: We are very excited to grow our partnership with Dennys restaurants. We believe that the success of the concept is proven based on the results of the conversions already completed and we look forward to rapidly expanding the conversions. By aligning our brands, our mutual focus on quality and our commitment to satisfying customers, we believe this will result in a great opportunity to better service the traveling public. We look forward to building on this relationship with Dennys and their leadership team.
Source: Denny’s Corp.
