Houston, TX - December 10, 1998 - The management of Luther's Bar-B-Q, Inc. (Luther's®) together with Castle Harlan Partners III, L.P., a $630 million private equity fund managed by Castle Harlan, Inc. (Castle Harlan), a New York merchant bank, has purchased the 20 unit barbecue restaurant chain from a group of private investors. The sale was finalized on November 30, 1998 and the price was not disclosed.
Mike Jolley, President and CEO of Luther's, who led the management team, said, "I'm delighted to be working with Castle Harlan. The firm has a solid record in backing strong management teams and well run companies, with particular experience in restaurants. The strength of Luther's concept, our new capital structure and Castle Harlan's support will allow us to realize a lot of new growth. We may also look to expand by acquisition. Our minimum goal is to complete the building of at least 10 new restaurants, principally in existing markets, over the next 5 years."
"The stability and experience of the management team at Luther's was a big attraction for Castle Harlan," said Howard Morgan, managing director at the firm. "Luther's management has been in place continuously for 15 years, and we are confident that these executives will provide the effective leadership essential for future growth."
Castle Harlan has successfully backed other restaurant chains including Morton's of Chicago (formerly known as Quantum Restaurant Group), which was taken public in 1992, McCormick & Schmick's, which was sold to Apple South in 1997, and Charlie Brown's. Morton's CEO, Allen Bernstein, will be a director of Luther's.
Luther's Bar-B-Q was established in 1975 and currently operates 20 restaurants located in Texas, Louisiana and Colorado. Luther's also operates several kiosk sites in companies such as Brown and Root and in the Astrodome. The company also has one smaller restaurant, designed mainly for take-out traffic, called Luther's Outpost. Annual sales for Luther's top $33 million.
Castle Harlan professionals have a 30-year history of helping management grow businesses. Since its inception in 1987, Castle Harlan has completed acquisitions of companies with a total purchase price in excess of $3 billion. These companies manage assets of more than $27 billion, have revenues in excess of $2 billion and employ more than 35,000 people worldwide.