Pacific Capital orders up a Sizzler

One of Australia’s largest private equity funds plans to take private a Southern California restaurant operator.

Australian private equity firm Pacific Capital Partners is paying around $208 million (€162 million) for outstanding shares of Sherman Oaks, California-based Worldwide Restaurant Concepts, which operates the Sizzler steakhouse chain.
 
The actual price per share will be determined based on the exchange rate between the Australian and US dollars on the day before the merger, sometime in the third quarter of this year. The floor will be $6.65 if the exchange rate is 0.7339 or lower and a high of $7.25 if the rate is 0.8140 or above.

The restaurant chain operates more than 445 restaurants worldwide under the Sizzler, Pat & Oscar’s and KFC banners. A number of these restaurants are in Australia, including 110 KFC outlets in Queensland. According to the company, Worldwide reported $347 million in revenues in the year ending April 30, 2004, with more than 70 percent of those revenues being generated in Australia.  

On Thursday the NYSE-traded shares closed at $4.92, but were trading up 28.3 percent, or $1.38, during Friday trading. Over the past year, the stock has traded between $2.91 and $5.35. In December, Worldwide announced it was exploring alternatives.
 
The deal is subject to shareholder approval, as well as franchiser approval since KFC is a division of Louisville, Kentucky-based franchiser YUM! Brands.

Pacific Equity Partners is one of Australia’s largest private equity firms. The firm has invested in marketing firm The Communications Group, New Zealand senior citizens service provider Guardian Healthcare and New Zealand bottler Frucor Beverages. Founded in 1998, the Sydney-based firm has more than A$500 ($390 million; €303 million) in private equity capital under management.