Frisch’s Restaurants Inc., the Cincinnati-based parent to 120 Frisch’s Big Boy restaurants and operator of 29 Golden Corral locations, has agreed to sell its Golden Corral business to NRD Holdings LLC, an Atlanta-based multiconcept operator.
Terms of the deal, which is expected to close by May, were not disclosed.
The deal includes Frisch’s Golden Corral operations and real estate, Frisch’s said in a statement Monday. The company’s Golden Corral units are located in Ohio, Indiana, Kentucky, West Virginia and Pennsylvania.
“We are pleased with the conclusion of our review of strategic alternatives for our Golden Corral business segment and believe this outcome will enhance shareholder value,” said Craig F. Maier, president and chief executive of Frisch’s.
The acquisition would add Golden Corral to NRD’s franchise portfolio of several Popeyes Louisiana Kitchen, Checker’s Drive-In and Domino’s Pizza locations in Florida, California, Arizona and Georgia. Last June, NRD acquired 23 Domino’s locations from the company.
Frisch’s announced the strategic review for its Golden Corral business last October, after it had closed six underperforming locations in Ohio. By the Dec. 13, 2011-ended second quarter, however, same-store sales at the 29 remaining Golden Corral locations in Frisch’s system rose 7.8 percent. The company credited national marketing promotions and customer migration from shuttered units to stronger Golden Corrals nearby for the traffic gains reflected in the same-store sales increase.
During the second quarter, Golden Corral accounted for $20.8 million of Frisch’s $70.7 million in restaurant sales, or about 29.4 percent. The division’s earnings before income taxes totaled $514,000.
Upon divesting Golden Corral, Frisch’s restaurants would all be located in Ohio, Indiana and Kentucky, under the Frisch’s Big Boy name.