Brinker to sell majority stake in Macaroni Grill

By Lisa Baertlein

LOS ANGELES (Reuters) - Brinker International Inc (EAT.N) will sell a majority stake in restaurant chain Romano's Macaroni Grill to an affiliate of private equity firm Golden Gate Capital for $131.5 million, Brinker said on Monday.

Brinker, which also owns the Chili's Grill & Bar chain, said it would retain a 20 percent interest in the brand. It expects the deal to close by year-end.

KeyBanc Capital Market Inc analyst Lynne Collier called the announcement "a slightly positive event" for the company.

"While we are encouraged that an agreement has finally been reached for the sale of Mac Grill, we believe that the final sale price was slightly lower than investors had expected," Collier said in a client note.

Dallas-based Brinker said it will record an impairment charge of $42 million to $47 million related to the sale.

Under the deal, Brinker will have representation on the board of the new entity and will provide corporate support services for a full year, with an option to extend for another year.

KeyBanc's Collier said she is concerned that the support component would "continue to result in additional costs to Brinker and will continue to distract management to some level from focusing on the core business and remaining brands."

Brinker and other operators in the mid-tier casual dining segment have been hardest hit by the U.S. economic downturn, which has caused consumers to cut back on trips to family restaurants.

San Francisco-based Golden Gate Capital has $9 billion in capital under management. In July the firm bought 75 percent of retailer Express from Limited Brands Inc (LTD.N).

Shares in Brinker were down 34 cents at $20.45 in early afternoon trade on the New York Stock Exchange.