NRD will pay $2.40 per share for Ruby Tuesday, which operates 599 bar and grill restaurants. The price is 37 percent above Ruby Tuesday’s closing price on March 13, the day before it said it planned to explore strategic alternatives.
Ruby Tuesday has been battling weak same-store sales and declining traffic for the past few years. In the recent quarter, the casual-dining chain said its revenues fell 15.3 percent to $217.3 million and same-store sales fell 5.8 percent in the fiscal quarter ended Sept. 5. Traffic during the period fell 9.4 percent.
|Stephen Sadove, non-executive chairman of Ruby Tuesday|
“The board of directors and our advisers have thoroughly evaluated all options available to the company and 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,” said Stephen Sadove, non-executive chairman of Ruby Tuesday. “NRD Capital has a distinguished track record of achieving and maintaining profitable growth for restaurant concepts and will be an excellent partner to lead Ruby Tuesday going forward.”
NRD Capital is an Atlanta-based private equity firm that specializes in franchised and multi-location business investments. The company previously acquired Fuzzy’s Taco Shop and Frisch’s Big Boy.
|Aziz Hashim, founder of NRD Capital|
“Our focus at NRD is investing in quality restaurant companies and providing strategic and operational expertise to create sustainable value,” said Aziz Hashim, founder of NRD Capital. “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. We are excited to be part of the company’s next chapter. As a private company, we will be able to take a long-term view on Ruby Tuesday, allowing us to make an investment in people, product and customer experience without public company constraints. This approach will enable us to reward everyone involved in our success, in addition to our investors.”