Private Equity Firm Acquires Ruby Tuesday

According to CNBC news reports published on Monday (Oct. 16), Beall, Illinois-based food service retailer Ruby Tuesday has agreed to an acquisition by Atlanta, Georgia, private equity franchise funding firm NRD Capital.

Ruby Tuesday has been battling declining sales and foot traffic for years. The company announced it would shutter at least 95 restaurants, according to August reports.

The acquisition will see all the company’s common stocks selling for $2.40 per share and NRD Capital assuming or retiring all debt obligations, CNBC reported. The total value of the acquisition has been approximated at $335 million.

CNBC noted the Ruby Tuesday acquisition purchase price “represents a premium of approximately 37 percent over Ruby Tuesday’s closing share price on March 13, 2017, the day before the company announced its intention to explore strategic alternatives.”

“We believe now is the right time to explore strategic alternatives that have the potential to position the business for long-term success and carry that legacy forward,” said Stephen Sadove, non-executive chairmen of Ruby Tuesday in a March news release published by Business Wire. “We are confident the process will identify the best strategic avenues to maximize the value of our business and achieve the best result for our shareholders, franchisees and team members.”

The acquisition valuation represented a more than 21 percent increase in the company’s valuation following market closing share prices on Friday (Oct. 13), according to the reports.

The Ruby Tuesday acquisition deal is still subject to shareholder approval, according to a report from NBC, with other customary closing conditions also a factor. Additionally, NBC noted the deal is expected to be completed sometime in 2018.


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