Red Lobster Sold to Golden Gate Capital for $2.1 Billion
Recipe of the day
- While McDonald’s Struggles, Burger King Reports Strongest North American Sales Increase in a Decade
- Restaurant Offers Jameis Winston Endless Free Crab Legs If Drafted by Tampa Bay Buccaneers
- New York’s Famous Carnegie Deli Shut Down After Alleged Gas Siphoning
- Restaurant Turns Tables on Customer’s Bad Online Review
- Restaurant Offends with Bruce Jenner Hot Dog
On Friday, May 16th, Darden Restaurants announced the sale of its Red Lobster chain to Golden Gate Capital, a private equity firm based in San Francisco which also owns California Pizza Kitchen, Payless, and Zale Corporation.
The $2.1 billion sale of Darden’s struggling seafood chain is expected to leave the company with roughly $1.6 billion in cash, of which $1 billion will be used to alleviate some of the company’s debt.
Darden will use the rest of the profits to buy back market shares.
Darden announced its intention to sell Red Lobster in December 2013, and will now turn its focus to Olive Garden, which has also struggled with declining sales in the last several months (a 5.4 percent drop compared to Red Lobster’s 8.8 percent drop in the first three months of 2014).
"All of the turnaround focus can be 100% on Olive Garden rather than fighting a war on multiple fronts," a source told CNN.
Karen Lo is an associate editor at The Daily Meal. Follow her on Twitter @appleplexy.
Be a Part of the Conversation
Join the Daily Meal's Community and Share your Thoughts