The Restaurant Group plc (LSE:RTN) reached an agreement to acquire Mabel Midco Ltd. from Duke Street LLP for approximately £560 million on October 30, 2018. The cash payment is expected to consist of £207 million in respect of the consideration for the entire issued share capital of Wagamama, and £150 million in respect of a repayment of shareholder loans. The cash payment is based on an expected completion date of mid December 2018 and is subject to closing adjustments. The acquisition implies an enterprise value for Mabel Midco Ltd. of £559 million. The Restaurant Group plc will assume net debt of £202 million in Mabel Midco Ltd., which includes the £225 million senior secured notes which are expected to remain outstanding immediately following completion. The acquisition will be funded through a combination of cash, new debt and a rights issue. A rights issue is to be undertaken to raise £315 million of gross proceeds which has been fully underwritten on a standby basis by J.P. Morgan Securities plc and is expected to be fully underwritten on launch by JPM and Numis Securities Limited. In addition, the acquisition will be financed through drawing on a £220 million revolving credit facility that has been underwritten for TRG by the Royal Bank of Canada as arranger. Mabel Midco Ltd. will be run as an autonomous division of the enlarged group. If the agreement is terminated The Restaurant Group must pay a break fee of circa £6 million to the Wagamama vendors. The transaction based on enterprise value of Mabel Midco has a multiple of 8.7x LTM August 2018 EBITDA including cost and site conversion synergies. Emma Woods, currently Chief Growth Officer of Mabel Midco, will become Mabel Midco’s Chief Executive Officer. Allan Leighton, the current Chairman of Mabel Midco, will join the Board of The Restaurant Group at completion as a Non-Executive Director. Jane Holbrook, current Chief Executive Officer of Mabel Midco, has decided to leave the business upon completion. The deal is subject to the approval of The Restaurant Group plc’s shareholders at a general meeting proposed to be held in late November 2018 and admission of the shares to be issued pursuant to the rights issue having occurred. As on November 12, 2018, GrizzlyRock Capital and Vivaldi Asset Management have opposed the transaction sighting destruction of shareholder value, where the general meeting will be held on November 28, 2018, for the shareholder approval. As on November 20, 2018, Columbia Threadneedle which owns 7.7% stake in The Restaurant Group decided to vote against its proposed acquisition of noodle chain Mabel Midco. The Board of The Restaurant Group plc intends unanimously to recommend in the combined circular and prospectus that TRG shareholders vote in favour of the requisite shareholder resolutions. As of November 28, 2018, the transaction was approved by the shareholders of The Restaurant Group. Completion is expected to occur in mid-December 2018. As on November 12, 2018, the transaction is expected to complete on December 21, 2018. The acquisition is expected to be earnings per share (EPS) enhancing in the first full year following completion and strongly accretive thereafter. Andrew Diggles and Alexander Thomas of RBC Capital Markets and Toby Radford, Behzad Arbabzadah, Virginia Khoo and Anne Ross of J.P. Morgan Cazenove acted as financial advisors for The Restaurant Group plc. David Johnson, Sally Wokes, Matthew Tobin of Slaughter and May, and, Cravath, Swaine & Moore LLP acted as legal advisors; and, Ernst & Young UK acted as accountant to The Restaurant Group plc. Kem Ihenacho and Martin Saywell of Latham & Walkins acted as legal advisors to Duke Street LLP. The Restaurant Group plc (LSE:RTN) completed the acquisition of Mabel Midco Ltd. from Duke Street LLP on December 24, 2018.