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Tuesday, October 31, 2006

CBRL Selling Logan's Roadhouse Instead of IPO

CBRL Group (CBRL) is a stock that has not been without criticism and not gone without volatility. The company had faced many internal pressures in the last year, although it has managed to get back closer to its highs over just the last 3 months.

CBRL has been in a long process of spinning off Logan's Roadhouse as its own standalone company in an IPO. We even covered the actual filing from the company back on July 14.

This morning, that has been thrown out the window. CBRL has opted to just sell the Logan's Roadhouse unit rather than go through an IPO and a full divestiture to shareholders. A New York-based private equity firm called Bruckmann, Rosser, Sherrill & Co., Inc. and a Los Angeles-based affiliate of Canyon Capital Advisors formed an affiliate group called LRI Holdings to acquire Logan's Roadhouse.

Logan's currently operates 143 and franchises 25 restaurants in 20 states. Total consideration in the transaction is $486 million, subject to approvals and contingencies. CBRL itself had a market cap of $1.32 Billion based on yesterday's close. More information can be found on the company and on the merger at the company website.

Jon C. Ogg
October 31, 2006

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