The Cheesecake Factory Received A $200 Million Investment A Month After It Was Unable To Pay April Rent
The Cheesecake Factory announced this week that it has received a $200 million investment from Roark Capital. This comes just a few weeks after the chain informed its landlords it would be unable to pay its rent for April.
In a statement regarding the investment, chairman and CEO of The Cheesecake Factory David Overton discussed how the investment will affect the chain's short-term future in light of the coronavirus outbreak, as well as its long-term financial security. As part of the deal, Paul Ginsberg, president of Roark, will join the Cheesecake Factory's Board of Directors:
We are pleased to have found a high-quality partner in Roark, who we are confident will add significant value to The Cheesecake Factory Incorporated. This transaction not only meaningfully enhances our liquidity position to navigate the near-term COVID-19 landscape and get our affected staff members back to work as soon as practicable, but also importantly, solidifies our ability to manage the business for the long-term for all of our stakeholders once we emerge on the other side of this crisis.
The Cheesecake Factory, like many in the food and beverage industry, took a significant financial hit as it moved to a to-go only model amid the COVID-19 outbreak. In addition to its inability to pay rent in April, the company has furloughed 41,000 hourly employees.
Roark Capital has a lot of experience investing in the food and beverage industry, as it counts companies like Auntie Anne's, Buffalo Wild Wings, Carvel, Jimmy John's, and Sonic in its current investment portfolio.
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