Jack in the Box Jack in the Box Inc. $JACK: $85.25(5.83%), on Monday, announced that it is going to acquire Del Taco Del Taco Restaurants, Inc. $TACO: $12.48(-0.24%), the second-largest Mexican fast-food chain in the U.S., for approximately $575 million, including debt.

With this deal, the San Diego based company gets an opportunity to become a “stronger QSR player with greater scale and the ability to enhance the guest experience while pursuing profitable growth.”

The fast-food restaurant chain will pay $12.51 per share in cash for the purchase.

“This is a natural combination of two like-minded, challenger brands with outstanding growth opportunities,” Jack in the Box CEO Darin Harris said in a statement. “Together, Jack in the Box and Del Taco will benefit from a stronger financial model, gaining greater scale to invest in digital and technology capabilities, and unit growth for both brands.”

Shares of Jack in the Box were up by less than 1% in premarket trading. It opened, on Monday, at $83.60 a share.

Its stock has plummeted 9% this year, with its market cap standing at $1.70 billion to date.

On the dashboard of Quantale, the impact of the announcement on the social engagement for the stock amongst the users of Twitter and Reddit will be printed as the day proceeds.

On Friday, its stock activity rose about 828%, combined with an increase of 33.34% of the trading volume.

jack in the box - Del Taco deal
Del Taco jumped as much as 65% to $12.40 per share in premarket trading, taking its market value to $450 million from $274 million.

Del Taco stock closed at $7.53 apiece on Friday. It opened, on Monday, at $12.40 apiece.

Del Taco has its presence in around 600 locations across 16 states. After Yum Brands’ Taco Bell, it is the second-largest Mexican fast-food brand in terms of the number of restaurants. In the third-quarter financial report, Del Taco posted the earnings at 11 cents per share, after adjustments, on sales of $124.3 million.

With this deal, together, the companies will have their presence in 2,800 locations spanning 25 states. "Sesn Stock News"

The acquisition is expected to close in the first quarter of the calendar year 2022.

Jack in the Box expects that the deal will boost its earnings per share by mid-single digits in the first year, excluding transaction expenses. In the fourth-quarter earnings, the company reported the diluted earnings per share of $1.80.

By the end of the fiscal year 2023, it seeks to realise $15 million in benefits from the deal, including supply chain savings and knowledge-sharing initiatives.