Sam Nazarian’s SBE Entertainment Group has designs on becoming a brand management and licensing firm – but now it’s selling off two of its brands.
The Los Angeles hospitality and entertainment company on Thursday announced that it sold off two of its biggest restaurant brands, Katsuya and Cleo.
SBE is selling the restaurant brands to New York hospitality firm ONE Group, creator of restaurant brand STK, for $75 million in cash, plus warrants to acquire 200,000 shares of ONE Group.
The ONE Group will also open at least 10 additional restaurants of Katsuya, Cleo and its own concepts at SBE’s new SLS, Redbury and Hyde hotels throughout the world over the next five years. Katsuya has nine locations, including four in Southern California, while Cleo has four.
Sam Nazarian, chief executive of SBE, said the sale is in line with the company’s strategy to focus on the management of its hotel, restaurant and entertainment properties.
“This enables us to remain asset-light, while deploying resources to incubate innovative ideas,” he said in a statement. “Our goal is to continue to create and monetize those innovations.”
But while this is just one of several big sales SBE has made over the past few months, the others have been sales of hard assets – specifically hotels – rather than of brands.
During an interview with the Business Journal in May, Nazarian said SBE’s current strategy is focused on selling many of its real estate holdings and striving to ink more brand management and licensing deals.
SBE in May sold its SLS Beverly Hills Hotel to Torrance’s Sunrider International for a reported $200 million. Last month, the firm also sold its SLS South Beach hotel in Miami. Meanwhile, several investors have cut ties with the firm rescinding hundreds of millions in potential investments.
The company did not immediately return a request for comment.