Darden Restaurants, Inc., Orlando, Fla., announced plans to acquire Cheddar's Scratch Kitchen for $780 million from its stockholders, including private equity firms L Catterton and Oak Investment Partners. Cheddar's will add to Darden's portfolio of differentiated brands, which currently includes Olive Garden, LongHorn Steakhouse, Yard House, The Capital Grille, Seasons 52, Bahama Breeze and Eddie V's.
Cheddar's was founded in 1979 in Arlington, Texas, and features high-quality, made-from-scratch food. Cheddar's operates 165 locations, including 140 owned and 25 franchised, across 28 states.
"Cheddar's is an undisputed casual dining value leader with broad appeal and strong average restaurant volumes," says Gene Lee, chief executive officer of Darden Restaurants. "Cheddar's is a great fit in the Darden portfolio because it complements our existing brands. This addition will also enable Darden to further strengthen two of our most important competitive advantages—our significant scale and our extensive data and insights."
Ian Baines, chief executive officer of Cheddar's, will remain president of Cheddar's.
"We are excited about the opportunity to be a part of Darden,” adds Baines. “Our operating philosophy and values are similar, and we believe this transaction provides a great opportunity for our team members to continue to grow and develop in their careers. Additionally, Darden's expertise will enable us to further capitalize on our growth potential."
The completion of the transaction is expected to occur in Darden's fiscal 2017 fourth quarter.