Nashville, Tenn.-based LRI Holdings, Inc., the parent company of Logan’s Roadhouse, Inc., owned by New York-based private equity firm Kelso & Co., said it is engaged in “discussions with certain stakeholders” regarding strategic alternatives to reduce the company’s indebtedness and improve liquidity.
On March 28, 2016, the company entered into an amendment to its credit facility. As a result of the amendment and discussions with other stakeholders, the company was unable to file its Form 10-KT within the prescribed time period, it said in an SEC filing.
Kelso & Co. acquired Logan’s in 2010 from Bruckmann Rosser Sherrill & Co., Black Canyon Capital, Canyon Capital Advisors and members of Logan’s management, in a reported $620 million leveraged buyout, which included $192 million in equity.
In June 2015, LRI Holdings completed a sale leaseback transaction on eight of its locations, amounting to $22 million in cash proceeds, a portion of which was used to pay down its revolver facility debt. In addition to the almost fully drawn revolver, Logan’s held $355 million in senior secured notes, which have a 10.75% interest coupon and semiannual payments, according to Dow Jones LBO Wire.
“Our brand repositioning strategy that is now in place is expected to help us gain traction in our business approach which should lead to improved performance,” said Logan’s Roadhouse president and CEO, Samuel Borgese. “Meanwhile, we continue to focus on key metrics in our business directed at improving guest satisfaction, employing targeted marketing programs to promote Logan’s innovation of exciting new menu items and applying new tools to help predict and reduce our reaction time to changing industry trends. Our entire focus is purposed to deliver on the renewal of the Logan’s Roadhouse brand.”
Logan’s Roadhouse is a casual dining steakhouse offering wood-fire-grilled steaks, made-from-scratch recipes, fresh ingredients and southern-inspired signature dishes in a roadhouse atmosphere. Logan’s opened its first restaurant in 1991 in Lexington, Ky., and is headquartered in Nashville, Tenn. Logan’s Roadhouse consists of 230 company-operated and 26 franchised restaurants in 23 states.
Kelso & Company has been investing in North American private equity for over 35 years. Kelso benefits from a successful investment track record, a long-tenured and stable investing team, a reputation as a preferred partner to management teams and strategics, and a significant alignment of interest with all of its partners. Since 1980, Kelso has raised a total of nine private equity funds, representing $11.2 billion of capital, and has made over 115 investments, over 90 of which have been exited.
Kelso was founded in 1971 by Louis Kelso, commonly referred to as the inventor of the Employee Stock Ownership Plan (or ESOP). The tenets of Kelso’s ESOP heritage, including a significant alignment of interest and history of partnership, remain key components of the Firm’s strategy and differentiation.