Marriott to Sell Restaurant Units : Deal Includes Stuart Anderson’s and Velvet Turtle Chains
Several restaurant chains well known in Southern California--including Stuart Anderson’s Black Angus and the Velvet Turtle--will be sold by their new owner, Marriott Corp., to a group of private investors, Marriott said Monday.
Anwar Soliman, who resigned last month as group executive of W. R. Grace & Co.'s restaurant division, leads the investors group that has signed a letter of intent to buy about 300 restaurants. Observers had expected Marriott to move quickly to sell the eateries, which were acquired as part of its $500-million purchase of Saga Corp., completed Monday.
The purchase price was not disclosed, but Dan Lee, an analyst with Drexel Burnham Lambert in New York, estimated the deal’s worth at between $200 million and $300 million.
In addition to 117 Stuart Anderson’s and 21 Velvet Turtles, the package includes several Los Angeles-area restaurants, including Chianti and the next-door Cucina restaurants on Melrose Avenue; Harry’s Bar & American Grill in Century City; three MacArthur Park restaurants, including one in Huntington Beach; two Prego locations, in Beverly Hills and San Francisco, and one Ciao restaurant in San Francisco. Also included are 147 Grandy’s restaurants, only two of which are in California.
Asked why Marriott decided to sell the restaurants, spokesman Robert T. (Terry) Souers said, “We really feel that our strengths are more centered on the family restaurant-coffee shop area and fast food.” The company owns about 870 Big Boy restaurants nationwide and 543 Roy Rogers restaurants in the Mid-Atlantic states.
Analyst Lee said Marriott bought Saga, based in Menlo Park, Calif., strictly for its food service division and had intended to sell the restaurant segments, some of which have had disappointing earnings of late. “My own guess is they’ll sell Straw Hat Pizza and Spoons,” two other Saga chains, he added. “This (sale) will bring the net cost for Saga down to a reasonable number.”
Until his departure from W. R. Grace, Soliman had led a group of management and other investors negotiating a leveraged buyout of Grace’s $1-billion restaurant group. A Grace spokesman said Soliman, who also was an executive vice president of the corporation, is no longer connected with that deal.
Marriott said the restaurant sale, which is subject to completion of a definitive agreement and approval by the company’s board, is expected to be finalized by year-end.