DineEquity Announces Expansion of IHOP Franchises Into the Middle East

The agreement marks the first major expansion of the IHOP chain outside of North America and represents the largest international development deal in the brand’s history.

DineEquity, Inc. (NYSE: DIN), announced that its wholly owned subsidiary, IHOP Franchise Company, LLC, has signed a multi-restaurant franchise agreement with an affiliated entity of Kuwait-based M.H. Alshaya Co., WLL, for the development of 40 new IHOP Restaurants in Kuwait, Saudi Arabia, Jordan, Lebanon, Qatar, the United Arab Emirates, Oman, Bahrain and Egypt. The agreement marks the first major expansion of the IHOP chain outside of North America and represents the largest international development deal in the brand’s history. DineEquity is the parent company of IHOP and Applebee’s Neighborhood Grill and Bar Restaurants, which comprise over 3,500 restaurants combined.
“This agreement illustrates our commitment to grow our business by leveraging DineEquity’s valuable brands and expanding beyond the markets we have traditionally served,” said Julia Stewart, DineEquity’s Chairman & CEO. “We look forward to working with Alshaya to make IHOP, with its unmistakable offerings and excellent service, a destination of choice for guests throughout the Middle East.”
IHOP will be one of the most recognized American family dining brands to enter the Middle East when its restaurants begin to open in the area over the next 12 months. Alshaya has a successful history of operating leading international brands in the region and plans to open the 40 IHOP restaurants there during the next five years.
“Consumers in the Middle East consistently tell us that they want the great quality and value that IHOP represents and we are pleased to introduce this leading American dining brand here,” said Mohammed Alshaya, Executive Chairman, Alshaya. “The popularity and international appeal of the IHOP brand, combined with our proven track record of operating and delivering exceptional service customized to the local market promises to create a powerful partnership.”
IHOP’s development program has historically focused exclusively on North America, with restaurants located throughout the U.S., Canada and Mexico. Recent international development has taken the brand to Puerto Rico, the U.S. Virgin Islands and Guatemala. IHOP plans to open between 55-65 new restaurants in 2011, the majority of which are expected to open in the U.S.
Jean Birch, IHOP President, said: “The Alshaya agreement marks a major milestone in IHOP’s international development strategy and reflects our commitment to make the brand accessible to more guests. IHOP is an icon in the industry, and we are proud to partner with one of the premier franchisees of international brands in the Middle East to deliver our delicious food and warm service to an entirely new set of guests and their families.”
The opening of traditional IHOP restaurants, both domestically and abroad, is one of the key tactics in fulfilling the ongoing strategy to expand the brand’s accessibility to new and current guests. IHOP opened its milestone 1,500th restaurant last year, and currently has a franchise development pipeline of more than 300 restaurants. In addition to traditional restaurant development, IHOP has also embarked on other growth opportunities, including the development of express concepts for non-traditional venues such as college and university campuses, military bases and airports, as well as licensing its name for select retail products. In May, IHOP launched “IHOP at Home,” a line of premium frozen breakfast foods. The items, which are available at almost 3,000 Walmart stores in the U.S., include French Toast Stuffed Pastries, Omelet Crispers and Griddle ‘n Sausage Wraps.