Orlando, Fla. — Darden Restaurants, Inc. and Ruth’s Hospitality Group, Inc. have entered into a definitive merger agreement in which Darden will acquire all of the outstanding shares of Ruth’s in an all-cash transaction with an equity value of approximately $715 million. Ruth’s, owner and operator of Ruth’s Chris Steak House, will complement Darden’s portfolio of differentiated brands which currently includes Olive Garden, LongHorn Steakhouse, Yard House, Cheddar’s Scratch Kitchen, The Capital Grille, Seasons 52, Bahama Breeze and Eddie V’s.
Ruth’s Chris was founded in 1965 in New Orleans by Ruth Fertel and features signature USDA Prime steaks, New Orleans-inspired sides and an award-winning wine list. Ruth’s Chris has 154 locations around the globe, including 80 company-owned or -operated restaurants and 74 franchised restaurants.
“Ruth’s Chris is a strong and distinctive brand in the fine dining segment with an impressive history of delivering elevated dining experiences to their loyal guests,” says Rick Cardenas, Darden’s president and CEO. “It fits the criteria we have for adding a brand to our portfolio and supports our winning strategy. Ruth’s Chris is a great complement to our portfolio of brands, and I’m pleased to welcome their nearly 5,000 team members to Darden.”
Cheryl Henry, president, CEO and chairperson of Ruth’s, adds: “We are excited about the opportunity to join the Darden family. Our strategy and operating philosophy align well with Darden, and we have a strong cultural fit that should ensure a smooth transition. This transaction will also provide more opportunities for our team members to develop in their careers as we continue to grow our 57-year-old iconic brand.”
Henry will continue to lead as president of Ruth’s Chris and will report to Cardenas.
The transaction, which is expected to be completed in June, has been unanimously approved by the boards of directors of both Darden and Ruth’s.
According to the company, Darden has sufficient liquidity to complete the all-cash transaction without obtaining additional financing. Darden expects to continue to maintain a strong balance sheet and have sufficient capital to achieve its stated capital allocation priorities of maintaining existing restaurants, growing new restaurants and returning capital to shareholders through dividends and strategic share repurchases.
Hunton Andrews Kurth LLP is acting as legal advisor to Darden. Jefferies LLC is acting as exclusive financial advisor, and Kirkland & Ellis LLP is acting as legal advisor to Ruth’s.
Darden is a restaurant company featuring a portfolio of differentiated brands that include Olive Garden, LongHorn Steakhouse, Cheddar’s Scratch Kitchen, Yard House, The Capital Grille, Seasons 52, Bahama Breeze and Eddie V’s. For more information, visit www.darden.com.
Ruth’s Hospitality Group, Inc., headquartered in Winter Park, Fla., is the largest fine dining steakhouse company in the U.S. as measured by the total number of company-owned and franchisee-owned restaurants, with more than 150 Ruth’s Chris Steak House locations worldwide. For more information, visit www.rhgi.com.
SOURCE: Darden Restaurants, Inc.