Cara Operations signs deal to buy steakhouse chain Keg Restaurants Ltd.

Cara Operations signs deal to buy steakhouse chain Keg Restaurants Ltd.

TORONTO — Cara Operations Ltd. has signed an agreement to acquire steakhouse chain Keg Restaurants Ltd. (KRL) in a deal worth at least $200 million in shares and cash.

The restaurant company has agreed to pay KRL’s shareholders, Fairfax Financial Holdings Ltd. and Keg chief executive David Aisenstat, $105 million in cash and 3.8 million Cara subordinate voting shares.

In addition, Cara may be required to pay up to an additional $30 million in cash upon the achievement of certain financial milestones within the first three fiscal years following closing.

Under the deal, Aisenstat will assume oversight of Cara’s higher-end casual brands, including the Bier Markt, the Landing Group and Milestones restaurants. He will also join the Cara board as vice-chairman.

Cara says it intends to change its corporate name once the deal closes.

The companies say the acquisition is not expected to change the Keg’s relationship with the Keg Royalties Income Fund which will continue to receive royalties from Keg restaurants operated by KRL following the deal.

 

Companies in this story: (TSX:CARA, TSX:KEG.UN, TSX:FFH)

 

The Canadian Press

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