Tortilla acquires French rival Fresh Burritos

Fast-casual Mexican restaurant group Tortilla has acquired its largest European competitor for £3.3m.

Fresh Burritos was founded in France by Timothée Tronet in 2011 and operates 13 company-owned stores across the country, as well as 19 franchised locations, including in Réunion Island and South Korea.  

Meanwhile, Tortilla currently has 89 locations across the UK and the Middle East. Its franchise partners include SSP Group, Compass UK & Ireland and Eathos.

Earlier this year, serial hospitality investor Luke Johnson took a stake in the business amid "huge potential" for growth. 

The UK-based group had also bought rival Mexican restaurant chain Chilango for £2.75m from investment firm RDCP Group in May 2022. 

As part of its recent acquisition, Tortilla has secured rights to the Fresh Burritos brand and plans to open a fully-equipped 1,400 sq m central production kitchen in France that will provide a “gateway to mainland Europe”.

A new Tortilla European sub-board committee has also been created to “drive sustainable growth”, chaired by group non-executive director and former Yum! European franchise division chief financial officer Francesca Tiritiello.

Tronet will remain involved in the Fresh Burritos business as an advisor to the Tortilla France board.

Tortilla revealed plans for accelerated franchise growth across Europe following the acquisition, which was funded through a combination of cash payment and bank debt roll over.

Of the 13 restaurants that are being integrated into the wider Tortilla portfolio, seven are being purchased as an asset deal through insolvency proceedings, while six are being acquired as going concerns.

The acquisition is expected to lead to a loss of around £0.5m in adjusted EBITDA (earnings before interest, taxes, depreciation and amortisation) for year end 2024 before returning a positive adjusted EBITDA of £0.5m the following year.

Andy Naylor, chief executive of Tortilla, said: “Tortilla’s international ambitions are no secret, and acquiring Fresh Burritos is our gateway to mainland Europe. With Mexican cuisine surging in popularity, these prime French locations give us a solid launchpad. We’re set to leverage this acquisition, just in time for the Paris Olympics.”

Tortilla was founded in 2007 and is headquartered in London.