Darden Restaurants buy two new franchises

[metro]

I hope Darden keeps these two concepts out of the OKC market, we don't need anymore chain steakhouses.



Darden adds two restaurant chains

BUSINESS UPDATE
Darden Restaurants said Friday its $1.19 billion purchase of the owners of LongHorn Steakhouse and Capital Grille restaurant chains can make it a more significant player in the competitive steakhouse segment of the dining industry.



Orlando, Fla.-based Darden announced a deal last week to acquire all of Rare Hospitality Inc.'s outstanding shares in a tender offer with a price of $38.15 per share.

Darden, which operates the Italian chain Olive Garden and seafood restaurants Red Lobster, said the additions will help it challenge Outback Steakhouse in the steakhouse segment.

Competition is fierce in casual dining, where affordability and consistency are key, and fluctuations in food costs and factors that affect consumer behavior, such as high gasoline prices, can affect profits.

For the fiscal year that ended in June, Darden sales were up 4 percent to $5.57 billion.

Darden has 1,400 restaurants, with more than 600 Olive Gardens and Red Lobsters each.

Atlanta-based Rare Hospitality has 317 restaurants, including 287 LongHorn Steakhouse restaurants and 28 Capital Grille restaurants.

Outback, meanwhile, has more than 900 restaurants worldwide.

Darden Chairman and Chief Executive Clarence Otis said there was plenty of room for unit growth at LongHorn and enough infrastructure to add the two chains to a lineup that also includes Caribbean-themed Bahama Breeze and Seasons 52, a grill and wine bar with seasonal menus.

In May, Darden closed nearly half its 129 Smokey Bones locations and put the other 73 on the sales block because stores weren't selling enough.

Source: The Associated Press

[jbkrems]

Well, I've been to Capital Grille in other cities. The question is WHERE in Oklahoma City that Darden would open it. They'd have to find an empty space in Bricktown or some other upscale location, because that is a restaurant that would compete with RedPrimeSteak, Mahogany, Boulevard Steakhouse, etc.

As for Longhorn Steakhouse, I doubt that would go over here, as well. Plus, why would Darden re-invest in a market that it already has experienced failure - ???

[y_h]

Well, I've been to Capital Grille in other cities. The question is WHERE in Oklahoma City that Darden would open it.

Downtown CBD, preferably within walking distance between the Skirvin and Colcord. Downtown OKC could certainly use a nationally recognized, high end steak house in the heart of downtown. Until and unless Red Prime gains national attention as a destination dining establishment you really need to have a high end chain to accommodate the expense account dining crowd. Okay, need might be a bit strong of a term, but I think it would be quite beneficial. Shallow barometer as it may be, a top tier chain steak house like Palm, Ruth's Chris or Capital Grille does communicate to inbound business travelers that your city has "arrived."

What would be really great is if Capital Grille could be the dining anchor of an upscale retail development somewhere downtown.

[HOT ROD]

I totally agree with y_h statement above, a top steakhouse is needed in downtown's CBD.

It needs to be a streetfront in one of the skyscrapers, near the top hotels, where people will see it and visit when they come for business.

Like was said, having a Morton's of Chicago or Ruth's Chris or Capital Grille does tell people that OKC is one of the big boys.

This would not take away from Red Prime tho, since it would only elevate the status of the city (which means more people in town to patronize all establishments). And, since OKC is beef country - why not have Capital AND Ruth's AND Morton's, all downtown.? Or maybe Ruth's can be in NW at Founders.

I also hope OKC can get a McCormick's and Schmicks. We need to capitalize on the NBA and conventions and get high-end establishments in the city.

[Kerry]

You put a Ruth's on top of 360 and that would be awesome. How many people can fit up there? Ruth's has some large tables for "business meetings". Would they fit?

[John]

You put a Ruth's on top of 360 and that would be awesome. How many people can fit up there? Ruth's has some large tables for "business meetings". Would they fit?

There are some interior spaces (not on the revolving part) that could easily be 'boardroom' or private party rooms.

ie; NIKZ cigar room, or the band/dance floor area.