Olive Garden in Talks to Purchase Cheddar's
Hold onto your honey-butter croissants and chicken-fried steaks, America! Olive Garden's parent company, Darden Restaurants, announced this week that it plans to acquire Cheddar's Scratch Kitchen for a cool $780 million.
Cheddar's, which is known for its large portions and homestyle cooking, has 165 locations across 28 states—with the highest concentrations in the southeast and Texas. The acquisition would add a casual dining chain to Darden's portfolio, which also includes LongHorn Steakhouse and Yard House.
The Orlando Sentinel reports that Darden plans to expand Cheddar's to-go services, and will likely add new locations across the United States. Cheddar's tends to have a lower average bill (about $13.50, compared to Olive Garden's $17) but compensates with the sheer amount of business they pull in: about 6,300 people a week stop by for towers of onion rings.
"We wanted to make sure we added something to the portfolio that was going to give us strong opportunity into the future," Darden CEO Gene Lee said Tuesday morning in a call with investors. "We think that Cheddar's long-term can be the No. 3 brand and maybe the No. 2 brand in the portfolio."
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Ian Baines, Cheddar's CEO, seems optimistic about the deal. "We are excited about the opportunity to be a part of Darden," he said in a statement. "Our operating philosophy and values are similar and we believe this transaction provides a great opportunity for our team members to continue to grow and develop in their careers."