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AFC IPO rises 20%
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March 2, 2001: 11:59 a.m. ET
Operator of Popeye's and Church's Chicken sees shares make solid gain
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NEW YORK (CNNfn) - AFC Enterprises Inc., operator of Popeye's Chicken & Biscuits and Church's Chicken franchises, rose nearly 20 percent Friday, as the week's second IPO made its debut.
AFC Enterprises gained $3.37 to close at $20.37 on the Nasdaq.
On Tuesday, the offering from China National Offshore Oil Corp. Ltd. rose nearly 5 percent in its market debut. CNOOC (CEO: Research, Estimates), as the Chinese energy company is known, actually priced its IPO last Thursday, raising $1.3 billion, but didn't open until this week.
"AFC is as far away from high tech as you can get," said Corey Ostman, co-chief executive of Alert-IPO.com. "At the moment that's a good thing."
Atlanta-based AFC (AFCE: Research, Estimates) raised $159 million Thursday when it sold 9.375 million shares at $17 each, the top of its expected $15-to-$17 price range, via lead underwriters Goldman Sachs and Credit Suisse First Boston.
 AFC Enterprises has a diverse franchise mix, which helped the IPO rise, Ostman said. The company develops and operates quick-services restaurants, bakeries and cafes under such brands as Popeye's Chicken & Biscuits, Church's Chicken, Cinnabon and Seattle's Best Coffee. AFC Enterprises has 3,618 restaurants, bakeries and cafes in 46 states, the District of Columbia and 27 countries as of Dec. 31.
"Diversity is good because you can tackle different geographic areas with a subset of properties," Ostman said.
Los Angeles-based California Pizza Kitchen Inc., the last restaurant related-IPO, rose 35 percent last August. But unlike AFC, CPK (CPKI: Research, Estimates) is a restaurant chain while AFC is a franchise operator with different properties.
AFC Enterprises is profitable, with $27.5 million income on $725.2 million revenue for fiscal 2000.
AFC has many different rivals and its chicken franchises compete against KFC, while Cinnabon goes head-to-head with T.J. Cinnabon and Mrs. Fields. Seattle's Best Coffee competes against hometown rival Starbucks Coffee. 
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