After months of speculation, Darden Restaurants has finally sold their seafood-centric chain restaurant Red Lobster...for $2.1 billion. Those biscuits truly are worth their weight in gold! The company, which also owns Olive Garden, agreed to the princely sum with Golden Gate Capital, who will take the flailing restaurant off Darden's hands in an all cash deal. Darden plans to use $1 billion of the proceeds to pay down outstanding debt.
The 46-year-old chain had become the black sheep of the Darden family, with sales down 8.7% last year to $611 million. The company had tried menu changes and special deals to lure in customers but the tactics were unsuccessful. Executives say the popularity of quick-service chains like Chipotle, and inevitable price hikes on certain products, turned off customers to the chain. Darden will now focus its attention on Olive Garden, which also saw a decline of 5.4% last year.
It's unclear what Golden Gate Capital plans to do with Red Lobster, though it did sell the real estate to another holding company then lease it back, whatever that means. Regardless of the future of Seafood Feasts and Crab Nachos, at least we'll always have those biscuits.