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CEO Chris Pappas considers buying Luby’s Inc. assetsCEO Chris Pappas considers buying Luby’s Inc. assets

SEC filing discloses confidentiality agreement as company weighs liquidation; no proposal on table for cafeteria-Fuddruckers parent

Ron Ruggless, Senior Editor

September 23, 2020

2 Min Read
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Luby’s Inc. CEO Chris Pappas is looking at buying some assets of the cafeteria-Fuddruckers parent, which has announced plans to liquidate if shareholders approve.

Pappas and his brother, Harris Pappas, along with affiliated companies, own more than a third of shares in the Houston-based parent company to cafeterias, Fuddruckers and a contract foodservice division.

Chris Pappas filed Securities and Exchange Commission paperwork Sept. 18, saying he had been awarded access to “confidential information” on the company in order evaluate a possible deal.

Earlier in September, Luby’s board gave the go-ahead for a plan to liquidate the company’s assets, provided shareholders approve at a to-be-scheduled meeting. Luby’s had been seeking strategic alternatives, including a possible sale, for the past year.

SEC documents said Chris Pappas “in his individual capacity” executed the confidentiality agreement for company information.

The Pappas brothers and their Pappas Restaurants Inc., which owns such brands as Pappasito’s Cantina, Pappadeaux Seafood Kitchen and Pappas Bros. Steakhouse, have owned a stake in Luby’s since 2001.

Of 30.7 million shares on the market as of Aug. 26, Chris and Harris Pappas held 11.2 million personally and through Pappas Restaurants Inc. 

Related:Luby’s Inc. board approves plan for liquidation of Luby’s Cafeteria, Fuddruckers and more

Chris Pappas has served as CEO and president of the company since 2001. Harris Pappas served as chief operating officer until his retirement in April 2011 and continued as director until 2019.

Chris Pappas said the confidentiality agreement was issued on Sept. 11 and included no assurance of a possible transaction.

The Luby’s and Fuddruckers brands have struggled with sales over the past several years.

In the most recent Nation’s Restaurant News Top 200, Fuddruckers ranked No. 166 among brands in U.S. systemwide sales, falling to $217.6 million in the fiscal year ended August 2019 from $243.3 million in the preceding.

Similarly, Luby’s Cafeteria ranked No. 170 in U.S. systemwide sales, posting $209.2 million in the fiscal year ended August 2019, down from $226.1 million in the preceding year.

As of Jan. 21, Luby’s operated 118 restaurants nationally. The company also franchised 95 Fuddruckers, and its culinary contract services division provided foodservice management to 33 healthcare, corporate dining and sports stadium sites.

Contact Ron Ruggless at [email protected]

Follow him on Twitter: @RonRuggless

About the Author

Ron Ruggless

Senior Editor, Nation’s Restaurant News / Restaurant Hospitality

Ron Ruggless serves as a senior editor for Informa Connect’s Nation’s Restaurant News (NRN.com) and Restaurant Hospitality (Restaurant-Hospitality.com) online and print platforms. He joined NRN in 1992 after working 10 years in various roles at the Dallas Times Herald newspaper, including restaurant critic, assistant business editor, food editor and lifestyle editor. He also edited several printings of the Zagat Dining Guide for Dallas-Fort Worth, and his articles and photographs have appeared in Food & Wine, Food Network and Self magazines. 

Ron Ruggless’ areas of expertise include foodservice mergers, acquisitions, operations, supply chain, research and development and marketing. 

Ron Ruggless is a frequent moderator and panelist at industry events ranging from the Multi-Unit Foodservice Operators (MUFSO) conference to RestaurantSpaces, the Council of Hospitality and Restaurant Trainers, the National Restaurant Association’s Marketing Executives Group, local restaurant associations and the Horeca Professional Expo in Madrid, Spain.

Ron Ruggless’ experience:

Regional and Senior Editor, Informa Connect’s Nation’s Restaurant News and Restaurant Hospitality (1992 to present)

Features Editor – Dallas Times Herald (1989-1991)

Restaurant Critic and Food Editor – Dallas Times Herald (1987-1988)

Editing Roles – Dallas Times Herald (1982-1987)

Editing Roles – Charlotte (N.C.) Observer (1980-1982)

Editing Roles – Omaha (Neb.) World-Herald (1978-1980)

Email: [email protected]

Social media:

Twitter@RonRuggless

LinkedIn: www.linkedin.com/in/ronruggless

Instagram: @RonRuggless

TikTok: @RonRuggless

 

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