As the battle for a bigger slice of the $70   billion U.S. burger market heats up, CKE Restaurants is preparing to go public again in a $100  million stock offering.

CKE, the Carpinteria-based parent of burger chains Carl’s Jr. and Hardee’s, said in a May 17 filing with the Securities and Exchange Commission that it plans to raise about $100 million in capital through a public offering of its stock. The move comes less than two years after it was bought out by New York-based Apollo Management in a deal valued at about $1 billion, including debt.

Spokespersons for CKE and Apollo said the companies could not comment on the offering during the “quiet period,” the SEC-mandated window of time after filing to go public in which a firm can’t speak with media.

Darren Tristano with Chicago-based restaurant consulting and research group Technomic told the Business Times that CKE is likely turning to the public equity markets because it needs cash for growth. The chain has made public definite plans to expand with about 400 new restaurants in Texas and Florida. It also has plans for stores in Latin America and the Caribbean.

“It appears that they need additional capital to achieve their goals,” Tristano said.

The U.S. fast-food burger market is a $70 billion a year industry, he said, but it is dominated by McDonald’s, which gobbles up half of that market share, leaving Burger King, Wendy’s, Five Guys, CKE and other smaller competitors to duke it out for the rest.

McDonald’s has grabbed up more market share in recent years, both by diversifying its products — it now sells more chicken than beef — and offering dollar-menu items. Wendy’s, Burger King and others have followed suit.

But CKE has stayed the course, Tristano said. Its Six Dollar Burgers compete with sit-down establishments almost as much as with other fast-food chains, and that’s a good thing. “The companies with the products that have been able to weather the storm based on quality, bigger products, are going to continue to do pretty well,” he said.

CKE’s strategy has “obviously worked up until now,” he said. “Although many chains have gone to dollar menus, they’re now realizing it’s hard to go from a dollar to $1.79 for a product. What we’re going to see is a little bit of a backlash from consumers as they see the dollar items gain 80 percent increases in prices.”

As a West Coast burger company, CKE also competes for regional favoritism with In-N-Out Burger, Jack in the Box and Denver-based Smashburger, a fast-growing company that already has more than 140 locations five years after it was founded.

While other burger brands have gone after the family market, CKE has said that market is oversatured. Instead, it’s going after young men ages 18 to 24. It markets to them with promotions such as a recent rollout of sexy TV ads featuring swimwear model Kate Upton. “We make big, juicy burgers for young, hungry guys,” CEO Andy Puzder told the Business Times in 2008 as he showed off a new energy efficient Carl’s Jr. store near the company’s Carpinteria headquarters.

CKE currently has more than 3,200 restaurants operating under its Carl’s Jr. and Hardee’s brands, making it the fifth-largest burger chain in the world. The majority of its Carl’s Jr. restaurants are in California. Hardee’s operates in the Midwestern and Southwestern U.S. Internationally, CKE has restaurants in the Middle East and Russia, and it announced earlier this year that it plans to open about 50 new stores in Latin America and the Caribbean.

Speaking at an event hosted by CSU Channel Islands in September, Puzder said CKE plans to build about 300 restaurants in Texas over the next 10 years. Earlier this month the company said it wants to develop about 88 restaurants in the greater Tampa, Fla. market.

“If you take a look at what Jack in the Box, which is also more of a West Coast and California chain, has done, it has shifted more to franchising and to other states like Texas,” Tristano said. “There are a number of states where Carl’s Jr. and Hardee’s are not that common as well as north of the border to Canada.”

CKE said it has not determined the size, price or date of the public offering, but shares will be offered by both the Carpinteria firm and Apollo Management, its stockholder.

CKE said that if the offering succeeds, it will list on the New York Stock Exchange under the symbol CK. The proceeds from the offering will be used to repay debt and for general corporate purposes.

Tristano said it’s fairly common for fast-food restaurants to swing from public to private and back again, citing Burger King, which filed last month to go public again just 18 months after being taken private in a leveraged buyout.

CKE is the second-largest privately held company in the Tri-Counties, with revenue of $1.28 billion last year. That’s down slightly from the approximately $1.5 billion in annual sales it reported before the financial crisis.

Despite ambitious plans for expansion, it has suffered through growing pains and posted a $19.3 million loss for the fiscal year ended Jan. 31, following a year-earlier pro forma loss of $7.1 million.
The company has about 120 people working in relatively well-paying jobs at its Carpinteria headquarters. When Apollo took CKE private in 2010, it retained the company’s management team, including Puzder, its firebrand CEO.

Puzder has been an outspoken critic of California’s regulation-heavy environment for permitting new stores and for what he sees as byzantine rules for compensating employees in the retail sector. He has said that while it would “love to stay” in California, CKE is considering a move to Texas once its lease in Carpinteria expires in 2015.