Published: Tue, October 17, 2017
Business | By Max Garcia

Ruby Tuesday to be purchased by Atlanta-based private equity firm

Ruby Tuesday to be purchased by Atlanta-based private equity firm

In company news, Ruby Tuesday ( RT ) rocketed about 19% higher during Monday trading, topping out at $2.38 a share, after the restaurant chain said it has agreed to a $335 million buyout by a specialty fund managed by NRD Capital, an Atlanta-based private equity firm specializing in franchised and multi-location business investments. No analyst estimates were available for comparison.

Ruby Tuesday sales at restaurants open for at least one year fell 5.8 percent.

5, Ruby Tuesday operated 599 restaurants in 41 states, 14 foreign countries, and Guam, of which 541 were company-owned and 58 were franchises.

Ruby Tuesday's stock had halved in January off disappointing second-quarter earnings and ultimately bottomed at $1.69 in March, at which time the board announced exploration of strategic alternatives.

The company decided a sale to NRD was "the most promising opportunity to realize significant, immediate value for our shareholders and the best path forward for the Ruby Tuesday brand", Stephen Sadove, non-executive chairman of Ruby Tuesday, said in a statement.

Ruby Tuesday has posted a net loss for nine consecutive quarters amid declining same-store sales and revenue.

NRD's previous acquisitions include Fuzzy's Taco Shop and Frisch's Big Boy.

NRD Capital is an Atlanta-based private equity firm whose principals have restaurant experience with Popeyes Louisiana Kitchen, Checkers, Domino's, Moe's Southwest Grill, and other restaurant franchisors. "NRD Capital has a distinguished track record of achieving and maintaining profitable growth for restaurant concepts and will be an excellent partner to lead Ruby Tuesday going forward".

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