WILBRAHAM Mass. Friendly Ice Cream Corp., parent of the 515-unit Friendly's family restaurant chain, said Sunday it had agreed to be acquired by an affiliate of private-equity firm Sun Capital Partners Inc. for $15.50 per share, or $337.2 million in total consideration.
Friendly has said since March that it was seeking strategic alternatives, while battling with activist investor and Western Sizzlin chairman and chief executive Sardar Biglari. Through Western Sizzlin, a family steakhouse chain, and The Lion Fund, his investment holding, Biglari has been pushing for change at Friendly, including increased refranchising and a more aggressive effort to rejuvenate the Friendly's brand, which is also used on a line of retail ice cream. Biglari, The Lion Fund, Friendly chairman Donald Smith, and Friendly's co-founder S. Prestly Blake, who together own more than 50 percent of Friendly outstanding stock and have battled in the past over the company's direction, all have agreed to vote in favor of the transaction, Friendly said.
The pending buyout has no financing contingency, the company added. The proposed purchase price represents an 8.2-percent premium over the closing price of Friendly stock on June 15 and a 30.9-percent premium over the closing price on March 6, which was the day before the Friendly announced it was exploring strategic alternatives.
The deal has been approved by the board of directors and will need a favorable vote by more than 66 percent of shareholders to proceed. Friendly said it expects the transaction to close in the third quarter. Goldman Sachs & Co. acted as financial advisor to Friendly.
Sun Capital, based in Boca Raton, Fla., has been an active buyer in the restaurant industry, especially in the past two years. The company has invested in Real Mex Restaurants, Restaurants Unlimited, the Fazoli's Italian quick-service chain and Bruegger's Enterprises, to name a few of its restaurant interests.
Friendly is based here.