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Britain’s seemingly insatiable appetite for fried chicken can spur further private equity interest in a sector ripe for “significant growth”, despite a rush of recent deals, according to the UK boss of Popeyes.
Investment in the fast-growing fried chicken sector ramped up last month as US investment group Sixth Street paid £400mn to buy the UK arm of Popeyes’ rival Wingstop. TDR Capital took control of Popeyes UK, which holds the UK and Ireland franchise of the US chicken chain, last year after initially injecting £50mn in 2023.
“The Wingstop value was a good marker for the value of chicken in this opportunity at the moment,” said Tom Crowley, Popeyes UK chief executive. “If you can show fast growth successfully, then certainly more private equities are interested,” he told the Financial Times.
The appetite from buyout funds remains generally cautious in the UK dining sector, following a series of bullish investments in mid-market restaurants in the 2010s.
Private equity-backed dining chains exploited cheap debt to expand rapidly beyond city-centres, but pandemic lockdowns, cost hikes, labour shortages and higher interest rates hit their business models hard.
Crowley said the industry had learned the lessons of previous overexpansion, when many brands got “super carried away” with a mindset of “push, push, push”.
“Lessons need to be learned from overreaching store numbers,” he said, although the accessibility of quick service restaurants meant that “scale is more achievable” in this part of the market.
Such restaurants, which operated takeaways during the pandemic when other outlets were closed, have been attracting consumers since, amid high inflation.
“People have certainly traded out of casual dining into quick service restaurants as the cost of living crisis is really difficult for everybody,” Cowley said, noting that consumers were increasingly looking to chicken rather than beef as a protein source.
Fast food eateries, especially chicken places, have expanded rapidly in the UK.
While the number of casual dining outlets fell 4 per cent in 2024, quick service restaurant outlets rose by 5 per cent over the same period, boosted by a 12 per cent increase of chicken chains, according to Meaningful Vision.
Crowley said that Popeyes, founded in New Orleans in 1972 and known as Beyoncé’s wedding caterer, was “still in the hype phase”, with queues of people outside each store opening more than three years after it landed. The brand now has 65 sites in the UK.
As well as Wingstop, it faces established players such as KFC, with nearly 1,000 outlets, as well as new entrants such as Dave’s Hot Chicken and Chick-fil-A. There is “lots of competition, of course, but the category is strong and there is room for significant growth”, Crowley said.
It plans to open 350 sites by about 2031, with more than 45 restaurants, drive-throughs and takeaway hubs at rail stations expected to open this year to expand its reach to large cities such as Leeds and Bristol. It is targeting sales of more than £200mn in 2025, up 70 per cent year-on-year.
Nam Quach, managing director of DC Advisory, said the boom in fried chicken was not limited to the UK, noting fast growing around the world in recent years.
The difference in the UK was that “there are not many brands that have lots of scale”, suggesting room for further deals before some successful brands took control of the market.
“At the moment there’s a land grab of first-mover advantage,” he said. “The future is going to be dominated by three or four brands only.”
