Landry's Restaurants Inc. has canceled its $217.4 million deal to sell the company to Tilman Fertitta, -- the firm's Chairman and CEO -- on Monday due to unusual circumstances, involving two parts: the lenders and the U.S. Securities and Exchange Commission.
The SEC was requiring Landry's to disclose certain information from lead lenders (Jefferies & Co. and Wells Fargo Foothill) about the proposed purchase and for alternative financing in case the deal didn't go through. However, Landry's had committed with its lenders to keep that information confidential, the company said in a written statement.
But as the SEC insisted on the disclosure of the information, the lead lenders terminated the private transaction.
The lead lenders advised both Fertitta and the Company that the lead lenders would not agree to disclosure of the confidential information and that any disclosure by the Company or Fertitta would be in violation of the terms of the commitment letter and result in the lead lenders terminating their commitments for both the going private and alternative financing transactions Landry's said in a press release today.
Landry's also said it is pursuing the alternative refinancing of its existing approximately $400 million in senior notes with with Jefferies and Wells Fargo.
According to the company, despite the termination of the going private transaction, the lead lenders have agreed that the alternative financing to provide the company the ability to refinance its outstanding 9.5% notes and 7.5% notes will proceed.
Landry's expects the closing of the refinancing will occur prior to the end of February 2009.