City Outfitters shares down 9% after Vetri Household restaurant acquisition

Based in Philadelphia, Urban Outfitters is a lifestyle specialty retail company that engages in the retail and wholesale of general consumer products.

The restaurant serves Neapolitan pizza from its custom-built oven, such as the marinara which comes equipped with oregano, crushed san marzano tomatoes, garlic and olive oil.

Urban Outfitters, which operates 240 eponymous stores, as well as the Anthropologie and Free People brands, sees an opportunity to expand Pizzeria Vetri in particular, said CEO Richard Hayne, citing rapid expansion in spending on casual dining.

The retail chain Urban Outfitters Inc. getting into the restaurant business in a big way.

“It’s a flawless match”, he said.

The acquisition will make Vetri Family a subsidiary of Urban Outfitters, with Vetri leading the helm as president and Benjamin as COO. “URBN and the Vetri Family share the same singular goal, we pride ourselves on bringing the best possible experience to our customers and community”.

Pizzeria Vetri now has two locations in Philadelphia and has announced plans for another in Austin, Texas, earlier this year as part of a new Urban Outfitters center.

Eater.com reported that Mr. Hayne said of the partnership: “Having known Marc for nearly a decade and partnered with him through his charitable foundation, we are honored to have him, Jeff and the Vetri family join the URBN team”.

Plus, both companies are headquartered in the Philadelphia Navy Yard. Marc Vetri’s flagship restaurant, widely lauded as one of the best Italian restaurants in the country is not included in the sale.

Now what: Urban Outfitters’ conference call should shed a few light on why the company is getting into the restaurant business, but at the moment, investors aren’t taking the news well.

Under the current authorization to repurchase 20 million common shares from February, Urban Outfitters has repurchased and subsequently retired a total of 8.4 million common shares valued at approximately $282.7 million during the nine months ended in October, 2015.