Domino's buys biggest German pizza chain in $86m deal
The companies that own Domino's Pizza in the UK and Australia have set up a joint venture to buy Germany's biggest pizza chain.
Joey's Pizza has 212 stores across Germany with annual sales of €143m ($156.5m; £103.9m).
Germany is the world's fourth-biggest pizza market and the deal is worth up to A$120m ($86m).
The deal will increase the number of stores owned by Sydney-listed Domino's Pizza Enterprises to 1,870.
The joint venture will be two-thirds owned by the Australian company, with the remainder owned by the London-listed Domino's Pizza Group, which already has operations in Germany.
Don Meij, chief executive of Domino's Pizza Enterprises, said that entering the German market represented a long-term growth opportunity.
"The acquisition of the market-leading Joey's Pizza business provides immediate scale and marketing presence which we can build from," he said.
The company's Sydney-listed shares jumped more than 12% after the deal was announced. The stock has soared more than 125% in the past 12 months.
The Australian company also raised its profit outlook for the year to June by 30% - to A$166.1m net income before tax and other items.
The Domino's brand globally is owned by the New York-listed Domino's Pizza Inc.
The London-listed company has more than 800 stores in the UK, and holds franchises in Ireland, Germany and Switzerland. Up to 15 of its German stores will be bought by the joint venture.
Shares in Domino's Pizza Group have risen by 38% this year and the company is valued at £1.6bn.
Domino's Australia is the world's largest franchisee for the pizza brand. It holds the Domino's brand network in Australia, Belgium, France, Japan, the Netherlands, New Zealand and Monaco.
The Joey's Pizza deal is expected to be completed early next year, subject to regulatory approval.