Collins Foods is paying $110.2 million to acquire another 28 KFC restaurants in Tasmania, South Australia and Western Australia, cresting the largest chain of the fried chicken fast food outlets in Australia.

The deal with Yum! Brands will be funded by a $44.1 million equity entitlement at $4.55 a share, a discount of almost 10%, and debt of $69.3 million.

Collins Foods, also the owner of Sizzler restaurants in Australia and the franchisor for Sizzler in Asia, has gone into a trading halt. Its shares last traded at $5.17.

The company, following the acquisition, will have 223 KFC restaurants in Australia, making Collins Foods the country’s largest KFC franchisee.

“This acquisition provides an exciting opportunity for us to continue to grow in Western Australia and develop new growth platforms in Tasmania and South Australia,” says CEO Graham Maxwell.

“The acquisition portfolio is attractive and the transaction is consistent with Collins Foods’ strategy to drive operational growth while delivering strong value for shareholders.”

Collins today also posted its annual results, showing a 3.9% fall in net profit to $27.98 million. Revenue was up 10.3% to $633.56 million.

The company declared a steady final fully franked dividend of 9 cents a share.

The numbers for the year to April:

In March, Collins announced it was buying a chain of 16 KFC restaurants in the Netherlands from subsidiaries of Yum! Brands for €62.3 million ($AU87 million). The deal included another 20 new KFC restaurants to be opened this year.

Collins also has 13 franchised KFC restaurants in Germany.

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