New York, August 22, 2001 - Two New York-based private equity investment firms, Castle Harlan, Inc., and Bruckmann, Rosser, Sherrill and Co., Inc. (BRS), announced today they had completed their purchase of McCormick & Schmick's seafood restaurants from Avado Brands, Inc. (OTC Bulletin Board: AVDO) of Madison, Georgia, in a transaction valued at $123 million.
McCormick & Schmick's management, including founders Bill McCormick and Doug Schmick, also participated in the transaction.
McCormick & Schmick's operates 34 upscale seafood restaurants throughout the United States. In 2000, it had sales of $162.4 million, up from $125.6 million in 1999. Its headquarters is in Portland, Oregon.
Castle Harlan and BRS are both experienced restaurant investors and operators. Castle Harlan formerly owned McCormick & Schmick's but sold it in 1997 to Apple South, a predecessor company of Avado.
Equity Financing for the transaction that has just closed came from Castle Harlan Partners III L.P., a $630 million private equity limited partnership formed in 1997, and from Bruckmann, Rosser, Sherrill & Co. II, L.P. Fleet Boston, SunTrust Bank and IBJ Whitehall Bank formed a group that provided senior debt financing.
Castle Harlan was founded in 1987 by John K. Castle, former president & chief executive officer of Donaldson, Lufkin & Jenrette, the investment banking firm, and Leonard M. Harlan, founder and former chairman of The Harlan Company.
BRS was formed in 1995 by Bruce C. Bruckman, Harold O. Rosser, Stephen C. Sherrill and Stephen F. Edwards and manages approximately $1.2 billion of committed capital. The firm is currently investing its second fund, which has $770 million of committed capital. The founding partners are former senior officers of Citicorp Venture Capital Ltd., where they worked from the mid-1980s until forming their own firm.