Golden Gate Capital to buy On The Border

by Eric Schroeder
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DALLAS — OTB Acquisition L.L.C., an affiliate of San Francisco-based Golden Gate Capital, has agreed to acquire the On The Border Mexican Grill & Cantina brand from Brinker International, Inc. Financial terms of the transaction, which is expected to close by the end of fiscal 2010, were not disclosed.

Brinker currently owns, operates or franchises 160 restaurants under the On The Border name.

“On The Border is a strong leader in Mexican casual dining,” said Joshua Olshansky, a managing director at Golden Gate Capital. “We are enthusiastic about the company’s significant growth opportunities, and we are very pleased to partner with the On The Border team to continue the success of the brand.”

This is not the first time that Brinker and Golden Gate Capital have taken part in a transaction. In December 2008, another Golden Gate Capital affiliate, Mac Acquisition L.L.C., acquired a majority interest in Romano’s Macaroni Grill.

In addition to a minority interest in Romano’s Macaroni Grill, other Brinker restaurant brands include Chili’s Grill & Bar and Maggiano’s Little Italy.

In a separate announcement, Brinker said it has raised its full-year fiscal 2010 earnings-per-share outlook to $1.40 to $1.44 from $1.15 to $1.30. The company also said it is increasing its quarterly dividend payout by 27%, to 14c per share from 11c per share.

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