Ignite Restaurant Group Readies for Possible Sale
Ignite Restaurant Group, parent company to Joe’s Crab Shack and Brick House Tavern + Tap, is up for sale. Whether that deal includes one or both iconic brands remains to be seen.
The company’s board of directors announced Monday that a process has begun to pursue the sale of the business, “which could be sold as an entirety or through the separate sales of its two restaurant brands,” according to a release. A major shakeup on the senior management level also took place, with chief executive officer and board director Robert S. Merritt stepping down from both positions. He will remain a consultant to the company.
Jonathan Tibus, a managing director with Alvarez & Marsal, was elected the company’s new chief executive officer. Tibu is the former CEO of Last Call Operating Co., which owned and managed Champps, Bailey’s, and Fox & Hound. He was also the chief restructuring officer of quick-service concept Quiznos. Tibu clocked time as chief operating officer of Max & Erma’s as well.
Last Call filed for bankruptcy last year for the second time and was sold for $26.8 million to Fun Eats and Drinks LLC, a subsidiary of San Diego investment firm Kelly Investment Group.
Brad Leist, Ignite’s senior vice president and chief financial officer, was elected chief administrative officer. Steve Metzger, vice president and general counsel, received a promotion to senior vice president, general counsel and secretary of the company. Ellen Clarry will also continue as chief supply officer.
“We would like to thank Bob for his contributions to Ignite and for him agreeing to continue on in a consulting capacity to ensure a smooth transition,” says Paul R. Vigano, chairman of Ignite Restaurant Group, in a statement. “We are pleased that Jon Tibus will be joining the Company. His background and experience is exactly what we need right now—we believe Jon Tibus and the rest of the management team are the right people to lead the Company through our ongoing review of strategic alternatives, including the sale process we announced today.”
Ignite added that “there can be no assurance that the process that the company is undertaking will be successful. In addition, the company cannot predict the terms or timing of any transaction that it may undertake or whether any such transaction will result in any proceeds for the holders of the company’s common stock.”
Ignite has navigated a challenging atmosphere in recent years. In 2015, the company sold Macaroni Grill for just $8 million in cash after buying it for $55 million two years prior. Second-quarter financials also revealed that the company planned to close underperforming locations—at least eight—and that comparable restaurant sales were down 6.8 percent at Joe’s and 6.3 percent at Brick House year-over-year. Revenue also dropped 8.7 percent to $130.8 million.