Australian fast-food chain Guzman y Gomez announced it will exit the U.S. market and close its Chicago restaurant locations, abandoning its American expansion plans.

The company's shares surged as much as 20% following the announcement, indicating investor approval of the strategic decision to focus resources elsewhere.

The Mexican-themed restaurant chain had been operating locations in Chicago as part of its efforts to establish a presence in the competitive U.S. fast-food market. However, the company's offerings failed to gain sufficient traction with American consumers.

The decision represents a significant strategic shift for Guzman y Gomez, which had previously viewed U.S. expansion as a key growth opportunity. The chain will now concentrate on its core Australian market and other international operations.

The positive market reaction suggests investors believe the company's resources will be better allocated focusing on markets where it has demonstrated stronger performance rather than continuing to invest in the challenging U.S. restaurant sector.