Flip sale gives L Catterton new focus on high-growth Barcelona Wine Bar, Bartaco
L Catterton has agreed to the Landry’s purchase of Del Frisco’s chains. Landry’s, owned by Tilman Fertitta, will acquire the Del Frisco’s Double Eagle Steakhouses and the Del Frisco’s Grilles for an undisclosed amount. L Catterton just closed its $650M acquisition of the chains, along with Barteca’s restaurant brands, announced back in June. Now, L Catterton is essentially “flipping” the Del Frisco’s chains. The sale to Landry’s does not include (Barteca’s) Barcelona Wine Bar, nor Bartaco, however.
These were originally acquired by Del Frisco’s when it was a standalone, public company. L Catterton then acquired the Barteca brands through its June acquisition of Del Frisco’s. The move comes as no surprise as this outlet and other expert observers considered Barcelona Wine Bar and Bartaco to be the true gems of the June deal. As two high-growth, less mature chains, they fit well with L Catterton’s restaurant portfolio.
Also, as an an independent, public company, Del Frisco’s Restaurant Group (DFRG) had been previously forced to negotiate with activist investor Engaged Capital. The investment firm had pressed DFRG’s management group to consider a strategic review to increase shareholder value.
In February, DFRG’s board agreed to cooperate with the activist investor. Eventually, it conceded to a strategic review or sale of the restaurant company. Furthermore, Engaged Capital not only won over cooperation, but also a board seat.
Is Landry’s purchase of Del Frisco’s a win-win?
In addition, the Landry’s purchase of Del Frisco’s chains allows Greenwich, Conn.-based L Catterton to keep two high-growth-potential chains. Presumably, this will fuel the nurturing and expansion of Barcelona Wine Bar and Bartaco. L Catterton also owns a strong portfolio of high-profile restaurant brands. These include the likes of Uncle Julio’s, Protein Bar & Kitchen, Chop’t, and Noodles & Company.
“Del Frisco’s is a perfect complement to our existing high end steakhouse portfolio, which includes such notable concepts as Mastro’s, Morton’s, Vic and Anthony’s, Strip House and Brenner’s,” said Fertitta of the Del Frisco’s deal.
Fertitta also said that 35-unit Del Frisco’s will continue to operate without changes. Jefferies LLC acted as lead financial advisor to Landry’s, followed by co-adivsors Deutsche Bank Securities Inc. and North Point Advisors LLC.
Landry’s also scored a big win with a bankruptcy court approval to purchase Restaurants Unlimited (RUI), reported Nation’s Restaurant News. The bid for $37.2M adds restaurant chains the likes of Palomar to the Landry’s portfolio. The win in a Delaware U.S. bankruptcy court expands Landry’s beyond its 60 brands. Fertitta’s empire expands with another 30 brands, including Clinkerdagger, Cutters Crabhouse, Fondi Pizzeria, Henry’s Tavern, Horatio’s, Kincaid’s and others.
Photo credit: L Catterton (featured), Bartaco (inline)
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