Darden Restaurants Inc (NYSE:DRI) is purchasing Ruth's Chris Steak House chain owner Ruth's Hospitality Group Inc (NASDAQ:RUTH) for approximately $715 million.
Shares of RUTH are up more than 33% at $21.45 on Wednesday. Darden shares are flat.
The all-cash transaction will see Darden pay $21.50 per share, representing a 34% premium to RUTH's May 2 closing price. The deal is expected to be completed in June.
Ruth's Chris Steak House adds to Darden's portfolio of brands which currently includes Olive Garden, Longhorn Steakhouse, Yard House, Cheddar's Scratch Kitchen, The Capital Grille, Seasons 52, and more.
Ruth's Chris was founded in 1965. It currently has 154 locations worldwide, including 80 company-owned or -operated restaurants and 74 franchised restaurants, which generated total revenues of over $500 million in Ruth's fiscal year 2022, according to the company's press release.
"Ruth's Chris is a strong and distinctive brand in the fine dining segment with an impressive history of delivering elevated dining experiences to their loyal guests," said Darden President and CEO Rick Cardenas. "It fits the criteria we have for adding a brand to our portfolio and supports our winning strategy."