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McDonald's Acquires Minority Interest In Pret A Manger

Jan 31, 2001

McDonald's Corporation has reached an agreement to acquire a minority interest in United Kingdom-based Pret A Manger, a quick service food concept that serves mainly sandwiches, snacks and drinks at lunchtime.

The new investment will be used to support Pret A Manger's plans for international growth. The founders and existing shareholders, Julian Metcalfe, Sinclair Beecham, Andrew Rolfe and Harvey Smyth, will retain majority ownership and management control of Pret A Manger. Terms of the investment were not disclosed.

Pret A Manger operates more than 100 outlets across the United Kingdom, and opened its first international shop in New York last year. Plans call for more locations in Manhattan by the end of 2001 and the company is starting to look at expansion to Asia in the near future.

Claire Babrowski, Executive Vice President of McDonald's Corporation, said, "We are excited by our investment in an international partnership with Pret A Manger. We admire and congratulate the management and employees of Pret A Manger for all they've achieved in their short history. Pret A Manger is a strong brand with a loyal customer following that we believe can be successfully developed around the world.

"Our minority interest is a win/win. It gives Pret A Manger the resources to grow its business outside the U.K. and it provides McDonald's with another opportunity to advance our long-term strategy to seek a greater share of the informal eating out market by capturing meal occasions that don't make sense for McDonald's to offer," added Babrowski.

Andrew Rolfe, Chief Executive of Pret A Manger, explains, "We have tremendous confidence that McDonald's will help us grow Pret A Manger outside the United Kingdom. We explored various options to support our ambitious growth plans, including public flotation. The McDonald's investment is the best possible outcome, as they will provide so much more than just money. They share our commitment to long term growth, they understand what it takes to build a great retail business and they have unmatched international experience and capability.

"Our international partnership will provide us with capital to grow and enable us to take advantage of McDonald's expertise and infrastructure around the world including their capability in real estate, construction, distribution and business systems. Our vision remains to build an international retail business that we are really proud of. This investment by McDonald's will help us to achieve our goal."

Julian Metcalfe, co-founder, said, "Since opening the first Pret A Manger in 1986, Sinclair and I have been obsessed with selling good natural food to people who are in a rush at lunchtime. After 14 years, we are fortunate to have thousands of loyal customers in the U.K. and many visitors who have urged us to open Pret A Manger abroad. But to do this, we need a huge amount of support. Every new country will be an enormous challenge.

"This partnership gives us access to the resources to help take our passion beyond the U.K. It means that we can do what we do best -- focus on our customers, our food and our people. McDonald's has invested in us because they like what they see and what they eat! They want us to stay just the way we are -- our style of food, our people and culture will remain steadfastly at the heart of what we do. Pret is unique and will remain that way."

Pret A Manger is "passionate" about selling high quality, natural food to its customers. It has revolutionized U.K. sandwich and snack retailing since it opened its first shop in London more than fourteen years ago. Its mission is to provide fresh food -- made with natural ingredients and no additives -- which is served quickly by friendly energetic people, in a clean modern environment.

McDonald's is the world's leading global foodservice retailer with about 28,700 restaurants in 120 countries serving nearly 45 million people each day. McDonald's has a majority interest in the 104 restaurant Chipotle Mexican Grill chain, and owns and operates 156 Donatos Pizza restaurants and 707 Boston Market locations across the United States, and 41 Aroma Cafes in the United Kingdom.

SOURCE: McDonald's Corporation

Contact: Lee Zimmer 011-44-20-7827-8848 or Gina Coladangelo
011-44-20-7827-8889, both of Pret A Manger; or Media, Brad Trask,
630-623-3678; or Investors, Mary Healy 630-623-6429, both of McDonald's