Olive Garden’s Parent Company To Acquire Ruth’s Steak House — Retail Bum

Darden Restaurants, the parent company of Italian restaurant chain Olive Garden, has agreed to buy Ruth’s Chris Steak House for $715 million in an all-cash deal.

The steakhouse chain currently operates more than 150 locations across the world and generated $505.9 million in revenue last year.

The acquisition is the first Darden has made in six years after it bought Cheddar’s Scratch Kitchen for $780 million in 2017. It follows a period of rapid growth, with the company’s fine-dining restaurants registering an 11.7% growth and average weekly sales more than doubling compared to pre-pandemic levels. Darden CEO Rick Cardenas had also mentioned earlier in January that the company was looking to add a 10th chain to its portfolio for the right price point, according to CNBC.

Other major restaurant brands that are part of Darden’s portfolio include Eddie V’s and The Capital Grille.

The deal between the two companies comes at a time when mergers and acquisition activity in the restaurant space has primarily come to a standstill amidst rising interest rates that have driven up the cost of acquisitions.

One other high-profile deal that is expected to take place in the near future is the sale of Subway. The company’s bankers are now offering private equity firms a $5 billion acquisition financing plan with the goal of helping the company fetch more than $10 billion in its sale.

Originally published at https://retailbum.com on May 3, 2023.