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Macaroni Grill to get new owner

Brinker will sell most of its stake in the chain to private equity firm.

August 19, 2008|From the Associated Press

NEW YORK — Brinker International Inc., owner of the Chili's Grill & Bar chain, said Monday that it would sell a majority stake in Romano's Macaroni Grill to a private equity firm.

Under the agreement, Brinker would sell most of its stake to Mac Acquisition -- a unit of San Francisco-based Golden Gate Capital -- for $131.5 million in cash. Brinker would then turn over $6 million to Mac Acquisition to hold on to a 19.9% stake in the brand.

"Brinker International will retain a minority ownership position in order to both maximize the value to Brinker's shareholders and contribute to the success of Macaroni Grill as a stand-alone entity," Brinker Chief Executive Doug Brooks said in a statement.

Golden Gate Capital declined to comment.

A Brinker spokesman said it decided to sell the brand to Golden Gate because the firm "is an experienced consumer and retail investor and has a proven track record of partnering with corporations to help grow established brands."

Investors were largely expecting the sale. Brinker shares fell 60 cents, or 2.9%, to $20.19.

When Brinker said this month that it was in talks with a buyer to sell its majority interest in Macaroni Grill, some analysts were disappointed that the company was not getting rid of the entire chain of more than 220 locations.

In its last quarter, same-store sales at Macaroni Grill fell 5.7%. Same-store sales at Chili's, meanwhile, rose 3.4%. Same-store sales are a key indicator of restaurant performance because they measure growth at locations open at least a year rather than newly opened ones.

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