Investors forked over $36 million Thursday in the initial public offering for Star Buffet Inc., a new buffet-style-restaurant company created by Anaheim-based CKE Restaurants.
CKE, the parent company of the Carl's Jr. and Hardee's burger chains, had owned all of Star Buffet. It sold 60% of the company to investors and kept the rest. The company includes 16 HomeTown Buffets and two Casa Bonita Mexican theme restaurants.
The deal will also allow Star Buffet to complete its acquisition of seven restaurants from North's Restaurants Inc., a chain that operates in the Northwest.
Star Buffet currently operates its modestly priced restaurants in nine Western states, but it hopes to expand quickly into other regions, using some of the new capital to open restaurants and invest in or buy regional chains.
The buffet segment of the restaurant business is dominated by Buffets Inc., an Eden Prairie, Minn.-based company with 355 restaurants in 34 states.
A total of 3 million shares in Star Buffet were sold. Initially priced at $12 per share, they closed at $14.88 in their first day of trading on Nasdaq.