The transaction is valued at $3.5 billion in comparison with an initial agreement for $3.2 billion that was reached in early November 2006. With the close, OSI common stock, which last traded at $41.10 a share, ceased trading on the New York Stock Exchange.
Under the terms, OSI shareholders are entitled to $41.15 a share. However, founders Chris Sullivan, Robert Basham and Timothy Gannon are to receive $40 a share in cash.
The trio previously struck a deal with Kangaroo Holdings Inc., which is an entity controlled by funds associated with Bain and Catterton, based on $40 a share. Separately, each contributed shares to Kangaroo in exchange for its stock, and, with this transaction, those shares are now exchanged at the $40-a-share price.
Bain has an unspecified majority interest in the locally based company, and Catterton and the founders own a minority stake. The current OSI management team, led by Bill Allen, CEO, and Paul Avery, also has a minority stake and will continue to operate the business.
Both Bain and Catterton have other restaurant interests. Boston-based Bain has invested in Domino's Pizza, Dunkin Brands and Burger King, and its retail investments have included Michaels, Toys R Us and Staples, among others.
Greenwich, CT-based Catterton's restaurant investments have included Cheddar's Restaurant Holdings Inc., PF Chang's China Bistro and Baja Fresh Mexican Grill. Build-a-Bear Workshop is among its other retail investments.
In a statement, Allen refers to Bain and Catterton's experience in the restaurant industry and says it "will help us open a new and exciting chapter in our company's history. We believe that our restaurant concepts are better positioned to focus on opportunities and to execute our business initiatives as a private company."
The OSI portfolio includes approximately 234 Carrabba's Italian Grill units, 127 Bonefish Grill restaurants, 50 Fleming's Prime Steakhouse & Wine Bar locations, 23 Roy's, a smattering of Lee Roy Selmon's, Blue Coral Seafood & Spirits, and Cheeseburger in Paradise units in addition to Outback Steakhouse. Of the latter, 684 in the US are company-owned and another 107 in the US are owned by franchisees or in joint ventures. Still another 167 are located abroad.
The company reported a net income of $100.2 million for 2006 on revenue just north of $3.9 billion. Same-store sales fell in this year's first quarter across a majority of its brands. While total revenues rose 7.7%, compared with the first quarter of 2006, net income fell from $32.2 million to $27.6 million.
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