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Nation's Restaurant News, Dec 23, 1996

Veteran Burger King franchisee Manny Garcia sold his 67-unit franchise for $50 million to Sydran Services Inc., San Ramon, Calif., in order to concentrate on the growth of his fledgling casual-dinner-house concept, Pebbles. The deal made Sydran the second-largest BK franchisee in the nation, with 190 units.

Chronic softness in same-store sales and pressures by Wall Street prompted a number of companies to announce massive store closings in January. The most prominent was the 40-store closing by Commack, N.Y.-based Sbarro Inc. - the largest unit closing in the company's history. Sbarro said all of the targeted restaurants had been chronic underperformers. The company took a $10 million charge against earnings but insisted the closings would not impede its growth plans.

Fresh Choice, facing economic forces similar to those confronting Sbarro, closed 10 of its 58 buffet-style restaurants and planned to take a $24 million charge.

Instead of closing stores, Sizzler and Arby's sought to improve their bottom lines with corporate layoffs. The long-ailing Sizzler fired 72 employees, while Arby's laid off 40.

For other companies diversification was an enveloping trend in January, not the least of them being Boston Market, which acquired Einstein Brothers Bagels - a hodgepodge of five different bagel concepts under the Progressive Bagel Concepts umbrella - for $80 million.

Wendy's International diversified into a new business when it merged with the Canadian doughnut chain Tim Hortons in a $450 million marriage that gave Wendy's nearly 1,200 restaurants in the land of the red maple leaf.

Luby's Cafeterias Inc. entered the seafood business with its joint-venture agreement with Waterstreet Inc. Both companies are based in San Antonio.

The New York Restaurant Group - the Manhattan-based parent of Smith & Wollensky, Park Avenue Cafe, the Manhattan Ocean Club and other high-end restaurants - sold 25 percent of the company to help finance the expansion of the company's brands to other cities.

As if the first month of the New Year was an appropriate time to play corporate musical chairs, nearly a dozen restaurant companies saw major changes in their executive suites in January.

Charged with revitalizing the chain, Robert A. Speck, a Grandy's operations manager, was named president of Shoney's Inc.

In one of the biggest executive suite changes, Long John Silver's Restaurants Inc. tapped John M. Cranor III as president and chief executive. Cranor, who had been president of KFC Corp. for nearly five years, replaced Clyde Culp III. Cranor was charged with reviving the brand and improving its focus.

Another PepsiCo veteran, Larry Zwain, was named president and chief executive of the 843-unit Boston Market. Before the appointment Zwain had been president and chief operating officer of PepsiCo Restaurants International.

In another powerhouse appointment, Steak and Ale named Bob Mandes president. He had been an interim head following the resignation of John W. Alderson.

Arby's, looking to shore up its nontraditional penetration, named John Vanderslice to the newly created position of vice president and general manager of multi-branding. He had been with the company only for one year before the promotion, serving as vice president of brand development.