Shareholders of Irvine-based Rusty Pelican Restaurants Inc. on Monday overwhelmingly approved a previously announced merger plan with Vicorp Specialty Restaurants Inc. of San Diego.
Separately, the company reported a $752,000 net profit for its 1987 fiscal year, a dramatic increase from the year-earlier net loss of $256,000. Sales for the year ended Aug. 2 rose 36% to $60.3 million from $59.8 million a year earlier.
Under the $25.4-million cash buyout offer, Vicorp would pay $9 per share for the 2.8 million shares outstanding of Rusty Pelican common stock. Vicorp will also assume $18.7 million in long-term debt and capitalized leases of the seafood restaurant chain. About 73% of the shares were voted in approval of the transaction and about 1% were voted as opposed. The remaining shares were not voted.
Rusty Pelican operates 22 restaurants in seven states, including 13 in California. The restaurants operate under the names Rusty Pelican, Ancient Mariner and Rusty Duck.
Vicorp operates 83 specialty dinner houses in 11 states under the chain names of Hungry Hunter, Mountain Jack's, Boathouse, Monterey Whaling Co., the Dock and Carlos Murphy's.
If completed, the merger will end a search by Rusty Pelican for a way to cure the chain's financial problems.
Since its founding 23 years ago, Rusty Pelican has gone from posting the highest average annual sales per unit of any U.S. restaurant chain--$3.68 million in 1985--to a $256,700 loss last year, despite record sales of $59.8 million. Competition, sluggish alcohol sales and poor results at some units combined to make the company's 1986 fiscal year, ended Aug. 3, a dismal one.
By May, however, the chain seemed to be turning around when it recorded its first positive earnings comparison since July, 1985, with net earnings of $261,000 for the third quarter of its fiscal 1986.
Almost half of the company's fiscal 1987 net profit came in the fourth quarter, as Rusty Pelican reported net earnings of $331,000, up from $71,000 a year earlier. Quarterly revenues rose 4.8% to $19.7 million from $18.8 million during the like quarter of the company's fiscal 1986.