Board of Directors Unanimously Rejects
Acquisition Proposal from Romano’s Macaroni Grill
Bravo Brio Restaurant Group, Inc. (NASDAQ:BBRG) (“BBRG” or
the “Company”), owner and operator of the BRAVO! Cucina Italiana
and BRIO Tuscan Grille restaurant concepts, announced today that it
has rejected an unsolicited proposal it received on May 9, 2018,
from Romano’s Macaroni Grill (“Macaroni Grill”) to purchase all of
the fully diluted outstanding common shares of BBRG for
approximately $4.78 per share.
Macaroni Grill’s unsolicited proposal relies on
significant third party financing (both debt and equity), including
by Raven Capital Management LLC, which was a prior participant in
the Company’s comprehensive review of strategic alternatives that
led to BBRG’s entry into a definitive merger agreement on March 7,
2018 with an affiliate of Spice Private Equity Ltd. (“Spice”),
under which the Spice affiliate will acquire BBRG in an all-cash
transaction (the “Spice Merger Agreement”). Spice is a
Swiss-investment company focused on private equity investments,
which is controlled by GP Investments, Ltd. (“GP”), a leading
private equity and alternative investment firm.
BBRG’s Board of Directors thoroughly evaluated
Macaroni Grill’s proposal, including seeking clarifications from
Macaroni Grill on the terms and conditions of its proposal and
consulting with BBRG’s financial advisor and outside legal
counsel. Following that evaluation, BBRG’s Board unanimously
determined that the proposal did not constitute and would not
reasonably be expected to result in a “Superior Proposal,” as
defined in the Spice Merger Agreement and, accordingly, rejected
the Macaroni Grill proposal.
The Board of Directors of BBRG continues
to unanimously recommend that BBRG shareholders vote “FOR” the
proposal to approve and adopt the Spice Merger
Agreement.
In its May 9, 2018 proposal, Macaroni Grill
indicated that it would be relying upon fully committed financing
from third party equity and debt sources to finance the transaction
and not utilizing Macaroni Grill’s own cash on hand or immediately
available borrowing capacity. Macaroni Grill stated that it
would promptly provide commitment papers and other documentation
supporting Macaroni Grill’s financing plans. At the direction
of the Company’s Board, on May 10th the Company’s representatives
requested clarification of the terms and conditions of Macaroni
Grill’s proposal, including copies of the referenced commitment
papers. In response to that request, Macaroni Grill delivered
highly-conditional and non-binding letters of financing support
which were not enforceable by the Company. Macaroni Grill’s
representatives also communicated at that time that a transaction
between the Company and Macaroni Grill would be subject to an
additional regulatory condition relating to receipt of approval
under the Hart-Scott-Rodino Antitrust Improvements Act of 1976,
which such condition is not applicable to the transactions
contemplated by the Spice Merger Agreement. Macaroni Grill
also failed to provide the Company with a proposed revised merger
agreement that it would be prepared to execute to effect a
transaction.
The Board has provided Macaroni Grill with ample
time and opportunity to produce an actionable proposal with
fully-committed financing, and Macaroni Grill has failed to do
so. It is the belief of the Company’s Board that further
pursuit of Macaroni Grill’s offer would be potentially harmful to
the Company given the substantial liquidity constraints facing the
Company as described in the Company’s most recent Quarterly Report
and the significant potential negative impact to the Company’s
shareholders, operations and employees in the event of a broken
transaction. Accordingly, the Company’s
Board continues to unanimously recommend that BBRG
shareholders vote “FOR” the proposal to approve and adopt the Spice
Merger Agreement.
About Bravo Brio Restaurant Group,
Inc.
Bravo Brio Restaurant Group, Inc. is a leading
owner and operator of two distinct Italian restaurant brands,
BRAVO! Cucina Italiana and BRIO Tuscan Grille. BBRG has positioned
its brands as multifaceted culinary destinations that deliver the
ambiance, design elements and food quality reminiscent of fine
dining restaurants at a value typically offered by casual dining
establishments, a combination known as the upscale affordable
dining segment. Each of BBRG's brands provides its guests with a
fine dining experience and value by serving affordable cuisine
prepared using fresh flavorful ingredients and authentic Italian
cooking methods, combined with attentive service in an attractive,
lively atmosphere. BBRG strives to be the best Italian restaurant
company in America and is focused on providing its guests an
excellent dining experience through consistency of execution.
Additional Information and Where to Find It
In connection with the proposed transaction, the
Company has filed a definitive proxy statement on Schedule 14A with
the U.S. Securities and Exchange Commission (“SEC”).
COMPANY SHAREHOLDERS ARE URGED TO READ THE DEFINITIVE PROXY
STATEMENT AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC
CAREFULLY AND IN THEIR ENTIRETY BEFORE MAKING ANY VOTING OR
INVESTMENT DECISION WITH RESPECT TO THE PROPOSED MERGER BECAUSE
THEY CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED
TRANSACTION. The definitive proxy statement was mailed to
shareholders of the Company on or about April 20, 2018. Investors
and security holders may obtain the documents free of charge at the
SEC’s website, http://www.sec.gov. In addition, shareholders may
obtain free copies of the documents at the Company’s website,
www.bbrg.com, under the heading “Investors.”
Participants in the Solicitation
The Company and its directors and executive
officers and other members of management and employees may be
deemed to be participants in the solicitation of proxies from the
shareholders of the Company in connection with the proposed merger.
Additional information regarding the interests of such participants
in the solicitation of proxies in respect of the proposed merger is
included in the proxy statement and other relevant materials filed
with the SEC.
Cautionary Statement Regarding Forward-Looking
Statements
Certain matters discussed in this report are
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements are made based on known events and circumstances at the
time of release, and as such, are subject to uncertainty and
changes in circumstances. These statements may be identified from
the use of forward-looking terminology such as “anticipates,”
“believes,” “may,” “should,” “could,” “potential,” “continues,”
“plans,” “forecasts,” “estimates,” “projects,” “predicts,” “would,”
“intends,” “anticipates,” “expects,” “targets,” “is likely,”
“will,” or the negative of these terms and similar expressions, and
include all statements regarding future performance, earnings
projections, events or developments. There is no assurance that an
acquisition of the Company by Spice will be consummated and there
are a number of risks and uncertainties that could cause actual
results to differ materially from the forward-looking statements
made herein. The risks and uncertainties in connection with such
forward-looking statements related to the proposed transaction
include, but are not limited to, the occurrence of any event,
change or other circumstances that could delay the closing of the
proposed transaction; the possibility of non-consummation of the
proposed transaction and termination of the merger agreement; the
ability and timing to obtain the approval of the Company’s
shareholders and to satisfy other closing conditions to the merger
agreement; the risk that shareholder litigation in connection with
the proposed transaction may affect the timing or occurrence of the
proposed transaction or result in significant costs of defense,
indemnification and liability; adverse effects on the Company’s
common shares because of the failure to complete the proposed
transaction; the Company’s or Spice’s respective businesses
experiencing disruptions from ongoing business operations due to
transaction-related uncertainty or other factors making it more
difficult than expected to maintain relationships with employees,
business partners or governmental entities, both before and
following consummation of the transaction; significant transaction
costs which have been and may continue to be incurred related to
the proposed transaction; and other risks and uncertainties
described in the Company’s filings with the SEC. The Company, Spice
and GP caution readers not to place undue reliance on any
forward-looking statements. These forward-looking statements
represent the Company’s, Spice’s and GP’s judgment as of the date
of this report, and the Company, Spice and GP undertake no
obligation to update or revise them unless otherwise required by
law.
Contacts for BBRG:Investor
RelationsRaphael Gross / Dara Dierks(203) 682-8253 / (646)
277-1212
Media RelationsJake F. Malcynsky(203) 682-8375
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