Restaurant Group shareholders back £560m Wagamama takeover

28th Nov 2018 10:27

(Sharecast News) - The Restaurant Group has secured narrow shareholder approval for its takeover of Asia-inspired food chain Wagamama, despite fears of an investor backlash over the £559m deal.Around 60% of shareholders are understood to have voted in favour of the acquisition, which was first announced last month.Restaurant Group, which owns Frankie & Benny and Garfunkel's, had faced opposition from some investors, including Columbia Threadneedle Investments, which has a 7.7% holding. They are concerned that the deal - which will be funded through a mixture of cash, debt and a deeply-discounted rights issue - is too expensive and will increase the Restaurant Group's debt.The deal is also seen as risky as a time when a rapid expansion in the sector means mid-priced chains are suffering from over supply and stiff competition. Restaurant Group's chief executive Andy McCue has said he believes there is room for another "40-60" Wagamama outlets.Earlier this week, Pensions and Investment Research Consultants (Pirc) said the "risks and adverse implications for shareholders appear too great to overlook".A Restaurant Group spokesman confirmed that shareholders had backed the deal.Wagamama, which has 133 UK restaurants, is owned by private equity firms Duke Street and Hutton Collins.