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Lenard's Chicken is back in the hands of founder Len Poulter after he struck a buyout deal with minority stakeholder Blue Sky Alternative Investments (ASX:BLA).
The Brisbane-based asset manager has confirmed its EC2010 fund had exited its decade long investment in the embattled retailer.
Under the terms of the sale, Blue Sky has also provided Poulter with a working capital facility to get the deal over the line.
The chicken retailer, founded by Poulter 30 years ago, has been struggling with profitability in recent years.
It was revealed in March that it had only just broken even in the first half of FY18, down from a normalised profit of $400,000 a year earlier.
Blue Sky had revealed that Lenard's revenue was steady at $3.3 million over the period, although costs had risen sharply.
Blue Sky had previously put the business up for sale before settling on the deal with Poulter.
The private equity group took a 42 per cent stake in Lenard's in 2008.
Plans for a major expansion of the business were announced in 2015, with targets of 30 per cent revenue growth and a doubling of store numbers to 400 by 2017.
However, Lenard's has struggled in recent years in the face of a competitive retail environment and high shopping mall rents. Profitability has also been weighed down by debt.
It is understood to be weighing up its options on underperforming stores. The Lenard's network, which boasted 200 stores in 2015, currently comprises 80 stores.
Financial details of the sale to Poulter have not been disclosed.
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