The owner of Arby’s has agreed to purchase Buffalo Wild Wings for approximately $2.9 billion, according to Business Insider.
Business Insider on Tuesday reported that Buffalo Wild Wings will operate as a privately held subsidiary of Arby’s Restaurant Group once the deal is completed.
Arby’s CEO Paul Brown will also hold the same role in the parent company once the agreement is finalized.
“Buffalo Wild Wings is one of the most distinctive and successful entertainment and casual dining restaurant companies in America,” he said in a statement.
“We look forward to leveraging the combined strengths of both organizations into a truly differentiated and transformative multi-brand restaurant company,” Brown added.
Arby’s is a fast-food restaurant chain owned by Roark Capital Group, a private equity firm that also owns Cinnabon, a baked goods chain.
Roark will pay $157 a share in cash to acquire Buffalo Wild Wings, a casual dining restaurant and sports bar franchise.
The price per share is 34 percent about Buffalo Wild Wings’ closing price on Nov. 13, the day before Roark’s original bid of $150 a share.
Tuesday’s deal between Roark and Buffalo Wild Wings includes the latter company’s net debt before the buyout.
Buffalo Wild Wings’ stock on Tuesday climbed 6.5 percent in premarket trading, and the chain’s price has surged 33 percent since Roark’s initial approach in mid-November.
The company has faced rising pressure this year as escalating chicken-wing prices began weighing upon its bottom line.
Roark also made failed attempt to buy the fast-food chain Popeyes Louisiana Kitchen last February, with Restaurant Brands instead purchasing it for about $1.8 billion.
USA Today on Tuesday reported that Buffalo Wild Wings has more than 1,250 locations in 10 nations.
Arby’s has more than 3,300 locations in seven countries, and its parent company’s purchase of Buffalo Wild Wings comes amid higher labor costs and fresh fast-casual dining competitors.