Dutch Bros and 7 Brew to Battle for Salad and Go Locations

Dutch Bros and 7 Brew are headed for a court-approved bidding war over a portfolio of former Salad and Go real estate.

A bankruptcy judge approved a targeted auction between the two growing beverage chains Thursday, setting the stage for competitive bidding on Monday.

The competition stems from a $105 million agreement Salad and Go previously reached with Dutch Bros. Under an asset purchase agreement dated August 4, Dutch Bros agreed to acquire leasehold interests and site-related assets tied to 51 Salad and Go locations in Arizona and Nevada, along with 14 additional leases in Texas and Oklahoma. The original transaction therefore encompassed approximately 65 leases.

A second bidder emerged soon afterward. 7 Brew submitted a competing proposal, and the parties ultimately entered into an asset purchase agreement dated August 18. Salad and Go determined the proposal qualified as an “Alternative Transaction” under its agreement with Dutch Bros.

Bidding process

The court documents do not disclose 7 Brew’s current purchase price.

Under the Dutch Bros agreement, an Alternative Transaction must cover all or a substantial portion of the purchased assets and provide a cash purchase price exceeding the $105 million Dutch Bros price, assumed liabilities and the termination fee, plus another $10 million. The termination fee is $3.8 million plus reasonable expenses, including attorneys’ fees.

Salad and Go is opening more of its leases to the competition. Dutch Bros and 7 Brew can bid on available locations, and any leases that aren’t sold Monday can move to separate auctions in October.

If 7 Brew wins the auction, Salad and Go would pay Dutch Bros a $3.8 million termination fee, plus reasonable expenses, including attorneys’ fees, when the deal closes.

Salad and go history

The sale process follows a steep reversal for Salad and Go, which was founded in Arizona in 2013 and eventually grew to 146 restaurants across four states. The chain’s expansion into Texas and Oklahoma proved costly, with problems tied to site selection, brand awareness and its commissary model. Salad and Go ultimately closed those markets and its Garland, Texas, production facility, but the cuts weren’t enough to stop its cash burn.

The company filed for bankruptcy in early August and closed its remaining roughly 70 restaurants. Investors had provided approximately $27 million in new capital between December and January, but operating losses, rent on closed stores and wind-down costs consumed most of those funds.

Any leases that Dutch Bros and 7 Brew leave behind could still find buyers. The remaining properties are scheduled to be available in auctions October 1 for Western assets in Arizona and Nevada and October 2 for Central assets in Texas and Oklahoma, followed by an October 14 sale hearing.