Few private equity firms have shown an interest in the world of restaurants like Roark Capital Group, and the Atlanta-based buyout shop has opted to expand its portfolio in the sector once again.
Roark portfolio company Arby's has agreed to buy Buffalo Wild Wings for $157 per share in cash in a transaction valued at about $2.9 billion, including debt. Unanimously approved by the boards of directors for both companies, the deal marks about a 38% premium to Buffalo Wild Wings' weighted average stock price over the 30 days prior to November 13, the final trading day before news of a possible deal emerged. Upon closing, Buffalo Wild Wings will cease trading on the NASDAQ under the BWLD ticker symbol.
Specializing in chicken wings and a sports-bar atmosphere, Buffalo Wild Wings has more than 1,250 locations in 10 countries. Arby's is even bigger, with 3,300 fast-food stops spread across seven countries. Roark bought Arby's for a reported $130 million in 2011. The buyout shop has also made investments in Cinnabon (2004), Carl's Jr. (2013) and Jimmy Johns (2016), among other chains, as we covered
in a recent Investor Spotlight.
Overall, Roark has made 16 investments in the restaurants, hotel and leisure sector since the start of 2010, tied with Apollo Global Management for sixth among all PE and growth firms based in the US, per PitchBook data. KSL Capital Partners leads with 31 deals, followed by Blackstone (28), L Catterton (20), The Carlyle Group (19) and KKR (17).