Yum! Brands (NYSE:YUM) has traditionally operated restaurants seen as an alternative to the more traditional burgers and fries establishments offered by McDonald's (NYSE:MCD) and Restaurants Brands International's (NYSE:QSR) Burger King. The company owns Taco Bell, Pizza Hut, and KFC -- three non-burger chains that greatly expanded the fast-food market.

These days, McDonald's and Burger King face all sorts of burger-focused challengers. A number of companies have launched or expanded higher-end fast-casual burger chains that put pricing and quality pressure on the established burger-based players.

After focusing on being the alternative for so long, Yum! has decided to jump on that burger-based trend and take on the big players more directly by buying the Habit Burger Grill (NASDAQ:HABT) chain for $14 per share, or approximately $375 million.

The exterior of a Taco Bell.

Taco Bell has been marketed as a hamburger alternative. Image source: Yum!

What is Yum! doing?

It's a bold move that gives Yum! a brand that can stretch its appeal to new consumers. It's entering a very crowded space, but it can leverage what it already knows about its existing customers to deploy new Habit locations.

"As a fast-casual concept with strong unit economics, The Habit Burger Grill is a fantastic addition to the Yum! family and has significant untapped growth potential in the U.S. and internationally," said YUM! CEO David Gibbs in a press release.

Habit, he explained, offers higher-quality burgers than a traditional fast-food chain, but at a value price. That should position it well within the Yum! portfolio.

"The transaction is a win-win because it allows us to offer an exciting new investment to our franchisees and to expand an award-winning, trend-forward brand through the power of Yum!'s unmatched scale and strengths in franchising, purchasing and brand-building," said Gibbs.

Why this is good for investors

Habit Grill faced a very tough road on its own. There are more than a few chains vying to be the fast-casual leader for burgers, and competing as a stand-alone is hard, especially when you offer a limited menu. Now Habit can open stand-alones and leverage existing multiunit Yum! locations. That should allow for relatively quick, well-planned expansion.

Shareholders got a roughly $3 per share premium from where Habit was trading at the previous close. That's a nice return that could easily be rolled into shares of the new, larger Yum!.

For Yum! investors, the benefits are obvious. The company gets a product line that has some positive name recognition that complements its existing offerings. That's a deal that's not always easy to find, and it's hard to not see Habit becoming the fourth pillar of the company's growth strategy.

Habit has been a technology-forward company, and Yum! can ramp that up. This is a case where the big company can learn from the smaller one, as well as the other way around.

"Over the past few years, we've focused on becoming a total access brand by growing our delivery business, expanding our online ordering and mobile channels and enhancing the in-store experience by introducing drive-thrus, kiosks and technology-centric solutions for operations," said Habit CEO Russell Bendel in the press release. 

It's very rare that a deal makes this much sense. Yum! could use a differentiated burger brand, and Habit could use a deep-pocketed owner. Both companies get what they need, and that should be good for shareholders.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.