NRD Capital, an Atlanta-based private-equity firm, has agreed to buy long-struggling casual-dining chain Ruby Tuesday Inc.in a deal valued at $335 million, the companies said on Monday. There is no cost or fee to you.
"The board of directors and our advisors ... are confident that this agreement will provide the most promising opportunity to realize the highest value for our stockholders while providing the best path forward for the Ruby Tuesday brand, its employees, franchisees, and loyal customers", non-executive Chairman Stephen Sadove said. Notably, at least one analyst with Yahoo! In mid-morning trading, shares of Ruby Tuesday are jumping, up over 19% to $2.37 a share.
Aziz Hashim, founder of NRD, said that "With a well-established brand, differentiated from other casual dining restaurants by its Garden Bar, we see significant opportunities to drive value for Ruby Tuesday". NRD also hopes to utilize its past experience working with fellow restaurant companies like Popeye's and Domino's Pizza (DPZ - Free Report), as well as continue to develop its restaurant portfolio that includes Frisch's and Fuzzy's Taco Shop. In the last quarter that ended September 5, Ruby Tuesday reported on Monday that same-restaurant sales fell by 5.8 percent compared for the quarter compared to the same period a year ago.
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Separately, Ruby Tuesday reported a first-quarter net loss that narrowed to $9.8 million or $0.16 per share from $39.7 million or $0.66 per share in the year-ago period.
Under the terms of the deal, NRD Capital will acquire all of Ruby Tuesday's common stock for $2.40 per share in cash. The acquisition was unanimously approved by the casual dining chain's board of directors and it is now subject to shareholder approval. "We are excited to be part of the company's next chapter".