Filed under: Deals
One of my favorite restaurants is Romano’s Macaroni Grill, which has a great ambiance and menu. Well, the private equity firm — Golden Gate Capital - also likes the place. In fact, it has concurred to pay $131.5 million for a majority stake. The current owner is Brinker International Inc. (NYSE: EAT), which is the operator of Chili’s Grill & Bar, Maggiano’s Little Italy and On The Border Mexican Grill & Cantina.
Romano’s has 226 locations across the U.S. But while they are high-quality, the fact remains that the current economic environment has had a dampening effect and in the prior quarter same-store sells fell 5.7%. Brinker has actually tried to sell the division for about a year. Interestingly enough, there will also be an impairment charge for $42 million to $47 million on the transaction.
Brinker will keep a 20% position. But the most important thing is that the company will get a nice slug of cash - which is certainly much desired nowadays.
Tom Taulli is the author of various books, including The Complete M&A Handbook
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