Share “Darden to sell Red Lobster, keep Olive Garden”

Darden to sell Red Lobster, keep Olive Garden

The company said Friday that it would sell its seafood chain and the accompanying real estate to investment firm Golden Gate Capital in a $2.1 billion cash deal.
By CANDICE CHOI, Associated Press Published: May 17, 2014
Advertisement

Red Lobster, which opened in 1968, helped popularize seafood among Americans and today has about 700 locations in the U.S. and Canada. The first restaurant in Lakeland, Fla., boasted a menu including a half a dozen oysters for 65 cents and platters with frog legs and hush puppies for $2.50.

As it suffered sales declines more recently, executives blamed a variety of factors, including a refusal among customers to swallow price increases. In 2012, for instance, executives cited a $1 price hike for its “Festival of Shrimp” special in explaining a quarterly decline in sales.

More recently, the company tried to attract a wider array of customers by adding more non-seafood dishes to Red Lobster’s menu. The efforts didn’t take hold.

Darden sees more potential in fixing Olive Garden, which has about 830 locations. The company recently reworked the logo for Italian chain and has been adding lighter menu items it says reflect eating trends.