TORONTO – Priszm Income Fund, which has been Canada’s largest owner of KFC restaurants, has received court approval for the sale of 57 restaurants in Alberta and Manitoba, says its landlord Scott’s Real Estate Investment Trust (TSX: SRQ.UN).
Priszm has also sold its restaurants in the Maritimes, Ontario and British Columbia.
Landlord Scott’s said Friday that it received notice of the ownership change to Hi-Flyer Food Inc., a Canadian subsidiary of a pre-existing KFC franchisee in the Philippines.
Scott’s is the landlord at 13 of those locations, four in Manitoba and nine in Alberta.
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“We are pleased that the sale transaction of Priszm’s remaining Western Canadian locations has been approved and look forward to completing the necessary lease assignments with Hi-Flyer. This transaction continues the trend of further diversifying our tenant base and reducing our reliance on Priszm,” said Kevin Salsberg, chief operating officer at Scott’s REIT.
“This sale brings Scott’s REIT one step closer to realizing a conclusion of the Priszm matter and returning to a core focus of growing Scott’s REIT with a strong, diversified and stable tenant base across Canada.”
The Priszm income fund has a 60 per cent interest in Priszm Limited Partnership, which owns and operates quick services restaurants across Canada under the KFC, Taco Bell and Pizza Hut bands.
It has been operating under the Companies’ Creditors Arrangement Act since March, attempting to get a fresh start after selling assets and reducing debts.
As part of the restructuring, Priszm sold 204 of its restaurants – almost of its presence in Ontario and British Columbia – to Soul Restaurants Canada Inc. for $42.8 million and got permission to sell the rest.
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