Stock Market Watch

Landry’s Owner to Acquire Morton’s Restaurant (MRT)

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Shares of Morton’s Restaurant Group Inc. (NYSE: MRT) surged on Friday after Tilman Fertitta, owner of Landry’s Inc., entered into a agreement with the company under which he will acquire it for $117 million.

With the acquisition, Fertitta has added another major brand to his expanding restaurant empire. Fertitta, who already owns a 5% stake in Morton’s, outlined plans to modernize the company’s flagship steakhouse chain.


This is the second acquisition made by Fertitta in as many months. Last month, the industry veteran had acquired seafood chain McCormick & Schmick’s.

Morton’s which owns and operates restaurants the Steakhouse and Trevi restaurant chains, has been struggling to compete against fine dining peers like McCormick & Schmick’s and Ruth’s Hospitality Group.

According to Raymond James analyst Bryan Elliott, the valuations are toward the lower end of recent industry transaction multiples, which is due to the company’s below average margins and limited long-term growth visibility.

As per the terms of the agreement, Fertitta will commence a tender offer no later than 10 business days from the date of agreement for all outstanding shares of Morton’s common stock for $6.90 per share in cash. The transaction has been unanimously approved by the Board of Morton’s. The Board will recommend shareholders to tender their shares in the tender offer.

Christopher J. Artinian, President and CEO of Morton’s Restaurant, said that the transaction is a testament to the strength of the Gold Standard Morton’s brand the company has built over 33 years.

Fertitta, meanwhile, said that he could not be more enthusiastic about the acquisition. Fertitta said that Morton’s has built an iconic worldwide restaurant brand.

Morton’s shares surged on Friday. The stock rose to an intra-day high of $6.88. It ended the day 32.75% higher at $6.85 on above average volume of 6.13 million.

 

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edliston
Post Written By: Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.


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Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing.

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