Hell heats up fast-food market

Hell Pizza may be bought by Burger King and Hell may buy Pizza Hut. Picture / Martin Sykes

Burger King is completing due diligence to buy Hell Pizza, which may have big plans of its own involving Restaurant Brands' Pizza Hut chain.

Hell Pizza confirmed yesterday it was looking at a sale to Burger King's New Zealand operator Tasman Pacific Foods, but said it was not a done deal.

Hell Pizza, incorporating another pizza brand, Melt, is owned by Warren Powell, Callum Davies and Stuart McMullin.

The company has also been entertaining approaches from other fast-food interests.

It is understood that Hell has separately approached Restaurant Brands about the future of Pizza Hut. Unnamed Australian interests are said to have funding to back Hell in acquiring Pizza Hut.

Domino's Pizza, the big new player in New Zealand, might be one candidate, but a company spokesman said it was not party to the discussions with Hell or Restaurant Brands.

Restaurant Brands chief executive Vicki Salmon has returned from Australia where the company has been in protracted negotiations to sell its Pizza Hut operations in Victoria.

One industry player suggested that if the Burger King deal did not go ahead, Hell, with outside backing, might be the vehicle to rebrand Pizza Hut, or it could even make a full-scale bid for all of Restaurant Brands, including KFC and Starbucks.

The Business Herald reported this week that with sliding Pizza Hut sales sparking a profit warning and a fall in share price, Restaurant Brands could become a takeover target.

KFC and Pizza Hut franchises are sold by Restaurant Brands under an agreement with US company Yum Brands.

Last month Restaurant Brands brought forward by seven months its franchising agreement.

The previous agreement with Yum Brands was believed to be a factor in preventing a takeover by private equity fund CVC Asia-Pacific.