Cava Group, which agreed in August to acquire Zoe’s Kitchen (NYSE: ZOES), will have an uphill battle to turn around its Mediterranean restaurant rival.
Zoe’s Kitchen’s same-store sales, a key restaurant industry metric, fell between 7 and 8 percent in the first five weeks of the third quarter, according to a preliminary proxy Zoe’s filed with the Securities and Exchange Commission Sept. 25.
That followed two previous quarters of negative same-store sales comparisons: Sales fell 2.3 percent in the first quarter and 2.5 percent in the second quarter.
Those declining results actually allowed Cava and its fellow buyers — Panera founder Ron Shaich’s Act III Holdings and venture firm Invus Group — to lower their offer for the troubled restaurant chain. While their initial offer came in at $13.25 per share in early August, the buyers reduced that to $12.75 per share a week later. The deal is worth an estimated $300 million.
The new price “reflected the Company’s materially…Read the full story from the Washington Business Journal.