Darden announces 2 more Latin America deals
Darden Restaurants announces 2 more franchise deals for Latin America
ORLANDO, Fla. (AP) -- Darden Restaurants Inc., operator of Olive Garden, Red Lobster and other restaurants, is looking to expand even more in Latin America.
The Orlando, Fla., company said Friday that it has signed franchise deals with two restaurant operators, Grupo Piramide and Dosil SA.
Financial terms were not disclosed.
Grupo Piramide will develop Red Lobster, Olive Garden and LongHorn Steakhouse brands in Guatemala, El Salvador, Honduras, Nicaragua and Costa Rica. Dosil will develop the brands in Peru.
Some of the brands Grupo Piramide already runs in Central America include Starbucks, KFC, Pizza Hut and Wendy's. Dosil already runs KFC, Starbucks, Chili's, Pizza Hut and Burger King in Peru.
The deals come shortly after Darden announced an agreement with International Meal Co. to run Red Lobster, Olive Garden and LongHorn Steakhouse in Brazil, Colombia, Panama and the Dominican Republic.
Darden's overseas expansion efforts come at a time when the restaurant industry is shifting in the U.S. Casual dining chains were hit hard by the economic downturn, which made people more careful about eating out.
Competitors like Applebee's, which is owned by DineEquity Inc., responded by rolling out a "2 for $20" deal during the depths of the recession. But Darden has conceded that it was slow in emphasizing value. It has been working hard of late to hold onto its customers, ramping up promotions at Olive Garden and Red Lobster and stressing the affordability of its food.
The new deals with Dosil and Grupo Piramide will broaden Darden's operations to 12 Latin American markets. Aside from Latin America, Darden has franchisees in Mexico and Puerto Rico.
Kim Lopdrup, Darden's senior vice president of business development, said in a statement that the company is still committed to owning and running restaurants in the U.S. The company said that it thinks the best way to expand overseas is to team up with local restaurant operators due to their existing infrastructure, market knowledge and relationships.
Darden, through its subsidiaries, owns and runs more than 2,000 restaurants in North America, according to its website.
The company's stock added 8 cents to $50.63 in morning trading.
