A popular fine-dining establishment may be coming into new ownership soon. Darden Restaurants, the parent company of well-known restaurant chain Olive Garden, LongHorn Steakhouse, and more, has revealed an agreement to acquire the 154-unit Ruth’s Hospitality Group in a $715 million deal.
“Fine-dining restaurants’ sales growth is expected to outpace that of casual-dining eateries through 2026,” Darden Chief Executive Officer Rick Cardenas told investors Thursday on a conference call to discuss the deal, adding that upscale restaurants also have “significantly higher” margins.
With the acquisition of the Winter Park, Florida-based restaurant chain, Darden is expanding its portfolio of fine-dining restaurants, which currently includes The Capital Grille, Seasons 52, and Eddie V’s.
As CNBC noted, despite economists worrying about a potential recession this year, Darden has reported that high-income diners aren’t pulling back on spending at its existing chains, The Capital Grille and Eddie V’s. The source also explained that the average check at Ruth’s Chris is $97, according to Darden’s investor presentation; for comparison, the average check at Olive Garden, which accounts for roughly half of Darden’s revenue, was $21 in fiscal 2022.
“As we have seen in our fine-dining brands, consumers with income levels above $150,000 continue to dine out and maintain or increase their spending at casual or fine-dining restaurants,” Cardenas said.
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