Breaking up Darden to help investors
Shares of Darden Restaurants rebounded on Wednesday following talk of a possible breakup. If it does split, shareholders could find themselves with two solid stocks that are separate. Darden owns Red Lobster and Olive Garden, two of the more popular restaurant chains. The company also owns a considerable list of other businesses.
News on Wednesday indicated that Barrington Capital Group bought a 2.8 percent stake in the company, in order to push toward breaking it up.
Many people are not surprised that a hedge fund would take an interest in Darden. They point out that Darden is a diversified company and that its diversification could make it worthy of a breakup. The company is composed of several rapid growing restaurant franchises plus some other established businesses.
Investors may want to grab shares now so they don’t have to buy shares from two separate companies later. What does Darden own and operate? Founded in 1968 and headquartered in Florida, Darden operates Olive Garden, Red Lobster, Longhorn Steakhouse, Bahama Breeze Island Grill, Seasons 52, The Capital Grille, Eddie V’s and Yard House.
Its diverse, yet popular brands are well known all across the country. The brands are consistently leading money makers. Darden Restaurants stock is up slightly, leveling off at $49.78 per share.
With 1,900 restaurants, the company has annual revenue of around $8 billion. Total assets are $5.944 billion. Employing about 180,000 employees, it is considered one of the larger employers in the U.S. Many experts believe that splitting Darden would be a wise choice. Both stocks would be very profitable and give the investor the chance to earn from their investments.
The company announced in late September that it is looking to expand its market into Southeast Asia, which many consider would be a very wise and profitable move. Southeast Asia has a booming economy, and therefore, the restaurants would likely attract numerous customers. Many analysts say investing in Darden at this time could be a wise choice as things are sure to become interesting in the coming months.