The owners of Swiss Chalet and Harvey's are buying the St. Hubert restaurant chain.

The St. Hubert Group has accepted a $537 million offer for the chain's 120 restaurants in Quebec, Ontario and New Brunswick.

Cara Operations, based in Vaughan, Ontario, is also acquiring the production plants that make St. Hubert products which are sold in grocery stores.

Under the deal, the current St. Hubert management group will continue in their existing jobs, and work on expanding St. Hubert throughout Canada.

St. Hubert CEO Jean-Pierre Leger said this deal is the best way to ensure the future of the company, and to maintain jobs for its 10,000 employees.

"I didn't decide this overnight. I thought about it for five years," said Leger.

"The best legacy I can leave for St. Hubert is growth."

The St. Hubert restaurant chain was founded in 1951 in Montreal by the Leger family, and Cara says St. Hubert's head office will remain in Quebec.

Cara owns and operates several restaurant chains including Swiss Chalet, Harvey's and Milestones, and has more than 1,000 restaurant locations across Canada and in other countries.

Jordan LeBel, marketing professor at Concordia’s John Molson School of Business, says he believes the deal is more about the retail side of the two companies’ operations, not the restaurants. He said the distinction between grocery stores and restaurants are becoming blurred – grocery stores are selling more ready-made products and restaurants are entering homes through delivery or selling their products in grocery stores.

He said St. Hubert was ahead of the curve; the company began selling its products in grocery stores in the late 60s.

“They already have a foothold, they have knowledge, they have know-how, they know how to get that brand on the grocery store shelves and they know how to get consumers to go for it. That’s know-how that's worth something to Cara,” he said.

Members of the Parti Quebecois were quick to denounce the sale, implying that Quebec business owners should not be allowed to sell their companies to non-Quebecers.

 

Leger dismissed that idea, saying that no Quebec-based companies were a good fit with St. Hubert.

"I flirted with some companies in Quebec but I did not marry them," he said.

Leger added he had spoken to Investissement Quebec and the Caisse de Depot about expanding the company, but ultimately decided a sale to Cara was better.

"We've had great success in Quebec, but every time we've gone out of Quebec we hit a wall," said Leger. 

Leger, along with Cara CEO Bill Gregson, said St. Hubert plans to expand its Quebec operations, and any fears that jobs would be lost in Quebec were groundless.

"Our growth is tied to the growth of St. Hubert. There will be tremendous growth in this province," said Gregson.

"We see job increases. There will be more St. Hubert restaurants. There will be more restaurants under other brands. Our problem won't be job cuts. Our problem will be finding enough people to work in our restaurants."

Leger also pointed out that when Cara acquired the B.C.-based Keg restaurant chain, they left the Keg headquarters in Vancouver.

Gregson agreed, saying Cara was not going to impose its management on the Quebec-based chain.

"The dumbest thing we could do is take our Toronto-centric viewpoint and bring it to Quebec. We'd ruin our investment," said Gregson.

"They know how to be successful here. We don't."