NRD Capital, an Atlanta-based private-equity firm, has agreed to buy long-struggling casual-dining chain Ruby Tuesday Inc. in a deal valued at $335 million, the companies said on Monday.
NRD is paying $2.40 a share for the 599-unit bar & grill concept, or about 21 percent above Friday’s closing price of $1.99.
The price is also 37 percent above Ruby Tuesday’s closing price on March 13 this year — the day before Ruby Tuesday said it planned to explore strategic alternatives.
Ruby Tuesday had been exploring strategic alternatives in recent months following years of weak same-store sales and declining traffic. The chain’s estimated unit sales were less than $1.6 million, according to NRN Top 100 data — one of the lowest volumes in the casual dining sector — following more than a decade of weak same-store sales.
On Monday, the company said its revenues fell 15.3 percent to $217.3 million as same-store sales fell 5.8 percent in the fiscal first quarter ended Sept. 5. Traffic in the period fell 9.4 percent.
The company decided a sale to NRD was “the most promising opportunity to realize significant, immediate value for our shareholders and the best path forward for the Ruby Tuesday brand,” Stephen Sadove, non-executive chairman of Ruby Tuesday, said in a statement.
Former Popeyes, Domino’s and Checkers franchisee Aziz Hashim started NRD in 2014 and earlier this summer the firm closed on a $100 million fund. The company has previously acquired Fuzzy’s Taco Shop and Frisch’s Big Boy. But Ruby Tuesday is the investment firm’s biggest deal to date.