Domino's is fattening up its European operations by gobbling Germany's largest pizza delivery company.
The fast food giant is buying Joey's Pizza chain of 212 stores for 79 million euros ($A120.02 million) in a deal that is expected to help boost Domino's profit by nearly a third.
The acquisition comes just weeks after Domino's increased its presence in neighbouring France with the purchase of 89 Pizza Sprint stores for 35 million euro.
Chief executive Don Meij expects the group's European operations will soon eclipse those in Australia and New Zealand, where it currently derives the bulk of its earnings.
"We're really proud to say that in our portfolio now we have the second and fourth biggest pizza markets in the world being in France and Germany," he said.
"Europe's growing at much faster rate and pace from the bottom line point of view ... it will eclipse Australia and New Zealand which have always been the core engines of our business."
The deals in Germany and France increases the number of Domino's stores to 773 in Europe, where it also has operations in the Netherlands and Belgium.
And the group's appetite for expansion is growing.
The group now aims to have 2,500 stores in Europe, including 1,000 stores each in France and Germany, up from its previous target of 1,500.
By comparison, Domino's has 670 stores across Australia and New Zealand and hopes to increase that to 900.
Mr Meij said Domino's had long had an eye on Germany, the world's fourth biggest pizza market, and was pleased to secure the market leader in that country.
"Where we look at where we wanted to be, Germany was always one of those and it's dream, when you're coming into a market, to be able to get all that expertise that's local from the incumbent," he said.
Domino's upgraded its earning guidance for fiscal 2016 as it unveiled details of the German deal.
It now expects underlying net profit and earnings to rise 30 per cent each in fiscal 2016, up from its earlier forecast of a 25 per cent lift.
The news cheered investors, who pushed Domino's shares towards a record high. The stock closed $4.08, or 8.27 per cent, higher at $53.44.
Domino's is buying the Joey's Pizza chain from the UK-based Domino's Pizza Group, which holds the master franchise agreements for the UK, Ireland, Germany and Switzerland.
Under the deal, Domino's will form a joint venture with the UK-listed company for the acquisition, in which it will hold a two-thirds stake.
The Joeys business is likely to generate sales of 143 million euros and underlying earnings of around seven million euros for the year ended December 31, 2015.
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