Bojangles’ will be sold to two New York-based private equity firms in a cash transaction worth over $593 million.
The Charlotte-based chicken-and-biscuit restaurant chain’s board of directors unanimously approved an agreement to be acquired by Durational Capital Management L.P. and The Jordan Co. L.P., wherein Bojangles’ shareholders will receive $16.10 per share owned in the company.
At mid-morning Tuesday, the company was trading at $16.12.
Pending approval by company shareholders, the deal is expected to be completed by first quarter fiscal 2019. Bojangles’ will continue to be operated as an independent, privately-held company and will remain based in Charlotte.
William A. Kussell, Bojangles’ director and non-executive chairman, said the deal will offer the highest value for shareholders and a path forward for employees, franchisees and customers.
“In consultation with our outside advisors, the board of directors has been evaluating several strategic alternatives over the last several months,” Russell said.
The financial advisors to Bojangles’ board were Bank of America Merrill Lynch and Los Angeles-based investment bank Houlihan Lokey.
The sale comes after a year of business struggles for Bojangles’. In early-March, the company’s then-CEO Clifton Rutledge abruptly stepped down from his role “for personal reasons.”
In August, Bojangles’ second quarter earnings report missed expectations. The company reported earnings of 13 cents per share for the quarter, which fell short of expectations by Zacks Equity Research of 18 cents per share.
That was also a 43.5 percent decline from the 23 cents per share that Bojangles’ reported in the same quarter a year ago.
Durational Capital, founded in 2017, invests in consumer companies with a focus on long-term value and partnering with quality management teams. Managing partner Eric Sobotka said the firm admires Bojangles’ brand and quality of food.
The Jordan Co. has made capital commitments of over $11 billion to numerous industries, including consumer, transportation and healthcare, since its 1982 founding. Along with its New York headquarters, it has an office in Chicago.
“We are excited to invest in a company with such great growth potential, and we believe that with our and our partners’ support, Bojangles’ will be well-positioned for long-term success,” said Ian Arons, a partner at The Jordan Co.
Bojangles’ cancelled its Nov. 8 earnings conference call but will still issue an earnings release on that date.
