Tacala

Private Equity Manager (GP)

Case study

About the company

Tacala is the largest franchise operator of Taco Bell restaurants in the USA.

Founded in 1989 and headquartered in Alabama, Tacala operates over 360 Taco Bell locations across several Southeastern states, including Alabama, Georgia, Tennessee, Texas, Kentucky, Virginia, and North Carolina.

The company is known for its commitment to customer service, community engagement, and operational excellence, which has earned it recognition and awards within the Taco Bell franchise system.

Investment rationale

• Altamont Capital Partners (“ACP”) first invested in Tacala in 2012 and therefore is very familiar with the company and has held it through multiple funds for over a decade.
• Tacala’s position as the largest Taco Bell franchise in the USA made it an attractive investment. The company’s extensive network of locations and strong operational performance provided a solid foundation for growth.
• Pantheon recognised significant growth potential in Tacala’s business model and saw the opportunities to expand Tacala’s footprint through new unit development, same-store sales growth and strategic acquisitions.
• The investment aligned well with ACP’s focus on partnering with leading management teams to help middle-market businesses reach their full potential. Tacala’s experienced management team and strong track record of success made it a suitable partner for ACP.
• Tacala’s commitment to operational excellence and customer satisfaction resonated with ACP’s investment philosophy. The private equity manager’s experience in multi-unit consumer businesses positioned it well to support Tacala’s continued growth.

Our relationship

Pantheon has an established relationship with Altamont Capital Partners, having invested in primary funds, multiple co-investment opportunities and currently alongside the private equity manager in a manager-led secondary. In addition, Pantheon holds Limited Partner Advisory Committee (LPAC) seats in all of ACP’s primary funds I to IV.

Active management and value creation

• Tacala has more than doubled the number of restaurants from 160 to over 360 locations. This growth has been achieved through a combination of new unit development and strategic acquisitions.
• Tacala has more than quadrupled its earnings since ACP’s initial investment. This growth has been driven by increased sales, improved operational efficiencies and strategic expansion.
• In 2023, ACP and Tacala management formed a sister company to operate as a franchisee within the 7 Brew “drive-thru” coffee system. This diversification has provided additional growth opportunities and expanded Tacala’s business portfolio.
• Tacala has continued to model its “Here to Serve” principle, contributing over USD $4m annually to local communities through various charitable initiatives. This commitment to community engagement has strengthened Tacala’s brand and customer loyalty.
• Tacala has received numerous awards for its operational excellence, including the prestigious Glen Bell Award, which is given to Taco Bell franchisees that best demonstrate the brand’s values and high achievement in store operations.