Darden Restaurants to acquire Chuy’s for $605 million
Darden Restaurants Inc. is entering a new category as it adds another banner to its portfolio.
The restaurant company has agreed to acquire all outstanding shares of Chuy's for $37.50 per share, in an all-cash transaction valued at about $605 million. The Tex-Mex chain will join Darden’s portfolio of full-service restaurants, which includes Olive Garden, LongHorn Steakhouse, Yard House, Ruth's Chris Steak House, Cheddar's Scratch Kitchen, The Capital Grille, Seasons 52, Eddie V's and Bahama Breeze.
"Based on our criteria for adding a brand to the Darden portfolio, we believe Chuy's is an excellent fit that supports our winning strategy,” said Darden president and CEO Rick Cardenas. “I am excited to welcome their 7,400 team members to Darden and diversify the Darden portfolio into a new dining category."
Based in Austin, Tex., Chuy's operates full-service restaurants serving made-from-scratch, Tex-Mex-inspired dishes. With a motto of "If you've seen one Chuy's, you've seen one Chuy's!," each location is designed to offer a unique, "unchained" look and feel. The company had 101 restaurants in 15 states as of July 16, 2024. It generated total revenues over $450 million, with average annual restaurant volumes of $4.5 million, in the 12 months ending March 31, 2024.
“Darden shares many of our same core values, particularly our operating philosophy and strong team member cultures,” stated Steven Hislop, chairman, CEO and president of Chuy's. “Together we will accelerate our business goals and bring our authentic, made-from-scratch Tex-Mex to more guests and communities."
The transaction has been unanimously approved by the boards of directors of both Darden and Chuy's. It is expected to be completed in Darden's fiscal second quarter.
As of May 26, Darden had 2,031 restaurants, including 920 Olive Gardens, 575 LongHorns, 181 Cheddar’s Scratch Kitchens, 88 Yard Houses, 80 Ruth’s Chris steak houses, 66 Capital Grills, 44 Seasons 52s, 43 Bahama Breezes, 30 Eddie V’s and four Capital Burgers
BofA Securities is acting as financial advisor and Hunton Andrews Kurth LLP is acting as legal advisor to Darden. Piper Sandler is acting as financial advisor and Winston & Strawn LLP is acting as legal advisor to Chuy's.
