Denny’s to Go Private in $620 Million Deal
Following challenges after the pandemic, Denny’s announced it will be taken private in a deal valuing the company at $620 million, including debt. The board unanimously approved the agreement after engaging with more than 40 potential investors.
Acquisition Details
The breakfast chain will be acquired by TriArtisan Capital Advisors, Treville Capital, and Yadav Enterprises, one of its largest franchisees. Under the terms, shareholders will receive $6.25 per share in cash, totaling approximately $322 million. This offer represents a 52% premium over Denny’s closing stock price on Monday.
After the announcement, shares of Denny’s surged 47% in after-hours trading.
Company Background
Denny’s was founded in 1953 in Lakewood, California, originally as Danny’s Donuts. It was renamed Denny’s Coffee Shops in 1959 to prevent confusion with another brand and began trading on the New York Stock Exchange in 1969.
Recent Challenges and Changes
The company faced declining sales during the COVID-19 pandemic and has since struggled to adapt to shifting dining habits, including rising demand for delivery. Competition from emerging breakfast chains emphasizing healthier options, such as First Watch, also added pressure.
Last fall, Denny’s said it planned to close 150 of its lowest-performing locations. At the end of the second quarter, it had 1,558 restaurants worldwide.
Summary
Denny’s strategic shift to private ownership marks a major response to post-pandemic challenges and intensifying competition in the breakfast dining sector.