Blockbuster ex-CEO leads group buying Jamba Juice for $265 million
NEW YORK – Steven Berrard, the former chief executive of Blockbuster Inc. and co-founder of AutoNation Inc., on Monday announced his latest business venture – leading a group that is buying the fast-growing smoothie chain Jamba Juice Co.Berrard-led Services Acquisition Corp. said it is paying $265 million for the privately-held Jamba Juice, which is based in San Francisco. The chain – which opened its first location in 1990 – reported $345 million of sales last year at its 532 locations nationwide.Berrard, who did not return phone calls for comment, said in a statement that expansion will likely be a priority once the deal closes.”When we looked at Jamba Juice, we saw a unique lifestyle brand, with strong management, category dominance and solid store level economics,” he said. “With increased working capital and the experience of SVI’s management in rolling out concepts we are very excited about Jamba Juice’s ability to expand its current market presence.”Jamba Juice will continue to be run by Paul Clayton, who joined the company in 2000 after serving as president of the North America operations of fast-food chain Burger King. He said in a statement that the deal will give Jamba Juice the “the capital to reach its full potential.”The transaction is subject to customary closing conditions and shareholder approval. Once the acquisition is completed, Services Acquisition will change its name to Jamba Inc. and maintain its listing on the American Stock Exchange.Fort Lauderdale, Fla.-based Services Acquisition was formed specifically to make an acquisition, and raised about $127 million after going public in July. Berrard is its chairman and chief executive.The deal will also be funded with proceeds from a $198 million private placement with institutional investors.Berrard made a name for himself on Wall Street after teaming up with billionaire Wayne Huizenga in 1981. The duo ran Blockbuster during the mid-1990s, considered the video rental company’s biggest growth period. They then went on to co-found nationwide automobile dealer AutoNation in the late 1990s.In 1998, Berrard formed New River Capital Partners, a Florida-based private equity firm. Huizenga later retired from AutoNation to focus on his Huizenga Holdings investment firm, through which he owns the NFL’s Miami Dolphins.However, not everything Berrard has been involved with has taken off. He and former Blockbuster President Gerald Geddis created floral and gift shop chain Gerald Stevens Inc. in 1998, which at its peak owned some 300 stores nationwide. Gerald Stevens filed for bankruptcy protection in April 2001 and folded in November of that year.Shares of Services Acquisition rose $1.27, or 17 percent, to $8.75 in afternoon trading on the American Stock Exchange after reaching a new 52-week high of $9.13 earlier in the session.