NEW YORK (AP) - Darden Restaurants says it entered an agreement to sell its Red Lobster chain to investment firm Golden Gate Capital in a $2.1 billion cash deal.
The move comes as Darden, which also owns Olive Garden, fights to improve its financial performance.
Olive Garden and Red Lobster have been losing customers in recent years, and the company has been trying to update the image of its flagship chains.
Investors haves challenged Darden's plans to sell only Red Lobster, saying that the company to separate Olive Garden and Red Lobster as a pair from its more successful specialty restaurant group.
Darden, based in Orlando, Florida, has said that Olive Garden complements its portfolio of smaller restaurant chains that cater to customers willing to spend more.
ORLANDO, Fla. (AP) - A company spokesman says Darden Restaurants, Inc. is laying off a “handful” of workers at its Orlando headquarters as the restaurant company anticipates spinning off its Red Lobster chain.
Darden Spokesman Rich Jeffers said Thursday the positions are at all levels of the company. He refused to say how many employees are involved.
Jeffers says the company needed to make the changes as it prepares to spin off Red Lobster.
Red Lobster has 705 restaurants in the U.S. and Canada and is the biggest full service dining seafood restaurant operator in North America.
Company officials say Red Lobster has been unable to capture high-income customers as much as its other brands have, and a separation will give Red Lobster the opportunity to focus more on its core audience.
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