Betaville

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RARE Alert: Apollo/Casual Dining Group said to be circling The Restaurant Group Posted: 18 May 2016 11:55 PM PDT Loyal readers will have picked up on my scepticism about the recent The Restaurant Group bid rumours in my "Burnt fingers" series. However, perhaps too much time in journalism (over a decade now) can make you too cynical. So, I'm prepared to air The Restaurant Group takeover tale that I have stumbled across recently as it contains a lot more detail than your standard "private equity" bid rumours that go around the market every couple of weeks. Sources say US private equity firm Apollo, which controls the Casual Dining Group (formerly known as Tragus), has been looking at combining The Restaurant Group - owner of Frankie and Benny's, Chiquito and Garfunkel's - with the Casual Dining Group. It's not clear, however, whether Apollo has submitted a formal approach for The Restaurant Group but word is the buy-out house, founded by Wall Street buccaneer Leon Black, has got bankers at Morgan Stanley, advising on how it should pursue a deal. Apparently, talks have already been held with The Restaurant Group. Apollo took control of Casual Dining Group - owner of Cafe Rouge, Las Iguanas and La Tasca - via a debt for equity swap in 2014. So, it's not hard to see what the US predator's angle might be given The Restaurant Group has issued three poor trading updates in a row and seen its shares crash  55pc over the last twelve months. Now, readers need to aware this information is RARE of the RAREST kind. If you don't remember what RARE is, here is the definition: Market gossip that hasn't been tested through formal journalistic channels (public relations executives, bankers etc). The rumour might be total codswallop but then again there may be something in it, so it's worth airing on Betaville. What will be interesting is to see whether The Restaurant Group or Apollo/Casual Dining Group make a statement. The trend recently has been for potential offerors to go "pens down" once they are outed in the media so they don't have to confirm a report. Restaurant Group and Apollo both declined to comment.

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