MEMPHIS Tenn. Back Yard Burgers, Inc. said it has set a date for shareholders to vote on a proposed $38-million buyout of the company by an investment group led by former Shoney’s and Sonic chief Steve Lynn.
Aspecial meeting will be held here on Aug. 3 for a vote on the offer by shareholders of record as of the close of business on July 6, Back Yard announced. The board has recommended that shareholders vote in favor of the buyout by Lynn’s group.
The buyers include Reid Zeising, a principal of the Atlanta-based Cherokee Advisors LLC investment firm that is managing two specially formed funds participating in the deal, and Pharos Capital Group LLC, an equity company based in Nashville, Tenn.
Under the terms of the buyout, Lynn's group, BBAC LLC, would buy publicly traded Back Yard for $6.50 a share, which it said was a 29-percent premium over the stock's closing price on June 8, the last trading day before the agreement was announced. The group, which had already amassed an 8.7-percent stake in the company before making its initial offer in April 2006, also indicated it would repay Back Yard's debt, which is reflected in the deal's $38 million valuation.
Back Yard Burgers, based here, currently has units in 20 states, primarily in the Southeast. It reported net income of $876,000 for 2006 on revenue of $44.7 million.
