Pasadena pretzel chain Wetzel’s Pretzels has been sold to a Dallas private equity firm.
Levin Leichtman Capital Partners, the Los Angeles private equity firm that owned Wetzel’s for nine years, sold its majority stake to CenterOak Partners for an undisclosed amount, said Bill Phelps, Wetzel’s CEO and co-founder. The deal closed on Thursday.
The company will remain based in Pasadena and has no plans to close any of its roughly 300 stores or lay off any of the chain’s roughly 3,000 employees, Phelps said.
Phelps, who will remain CEO and the largest individual shareholder, said Levin Leichtman held a stake in the chain for much longer than other private equity firms, but the firm has had to close and sell its fund.
“They had to close on financing, so we went to the auction house,” Phelps said. “Center Oak Partners made us the best offer, both financially and to retain the team.”
Phelps and co-founder Rick Wetzel launched Wetzel’s Pretzels in 1994 after meeting while working in marketing for Nestle USA.
Since opening its first store at the South Bay Galleria in Redondo Beach, the chain has grown to about 290 locations nationwide and 20 internationally, including in Canada and Malaysia. Wetzel will remain on the board of directors but will step down as president. Wetzel is a co-founder of the fast-growing pizza chain Blaze Pizza.
Phelps said Wetzel’s Pretzels’ mall business has remained strong despite reports that malls and big-box stores are struggling, with same-store sales up 6.7% so far this year.
But Phelps acknowledged that future growth is likely to come increasingly from non-traditional shopping mall locations, such as train stations, bus terminals and inside Walmart Supercenters.
