New Hyde Park, NY, March 27, 2002 - Morton's Restaurant Group, Inc. (NYSE:MRG) announced today that it has entered into a definitive merger agreement providing for the acquisition of Morton's by an affiliate of Castle Harlan, Inc., a New York based private equity investment firm. Under the terms of the agreement, Morton's stockholders will receive $12.60 in cash for each share of common stock. The purchase price represents a 9.1% premium over yesterday's closing price of $11.55 and a 26.2% premium over the average closing price of Morton's stock for the last 20 trading days.
Following completion of the merger, Morton's will continue to be headquartered in New Hyde Park, New York, and the current management team will operate Morton's as a private company. Morton's owns and operates 61 Morton's of Chicago Steakhouse restaurants and 4 Bertolini's Authentic Trattoria restaurants.
Castle Harlan, Inc. was founded in 1987 by John K. Castle, former president and chief executive officer of Donaldson, Lufkin & Jenrette, and Leonard M. Harlan, founder and former chairman of The Harlan Company. Since its founding in 1987, Castle Harlan has completed acquisitions exceeding $5.0 billion. Castle Harlan is a highly-experienced investor which has successfully completed 35 transactions in a wide variety of industries including aviation services, consumer products, energy services, general manufacturing as well as restaurants. John K. Castle, chairman of Castle Harlan, Inc., and David B. Pittaway, senior managing director of Castle Harlan, Inc., are members of Morton's board of directors.
"We are delighted to announce the proposed merger," said Allen J. Bernstein, chairman of the board of directors, president and chief executive officer of Morton's. "The proposed merger is excellent news for our stockholders, our employees and our guests. Our stockholders will benefit from the premium over our recent stock price and the liquidity in their shares. Our dedicated employees will be part of a growing business and our guests will continue to receive the finest in food and service."
As a result of the evaluation of the Company's strategic alternatives, the Special Committee of directors negotiated the transaction for Morton's with the advice of Greenhill & Co., LLC, which acted as the financial advisor to the Special Committee and Richards, Layton & Finger, P.A., counsel to the Special Committee. The Special Committee received an opinion from Greenhill that the merger consideration is fair, from a financial point of view, to Morton's stockholders. Upon the unanimous recommendation of the Special Committee, Morton's Board of Directors approved the transaction by the unanimous vote of those participating (excluding Messrs. Castle and Pittaway, who were not present and did not vote). Completion of the merger is subject to various closing conditions including, but not limited to, approval of Morton's stockholders and customary industry regulatory approvals, receipt of third party consents and achievement of a minimum level of earnings. The buyer has secured required equity financing and the Company's existing bank lenders have amended the Company Senior Credit Agreement to support the transaction. The merger is currently expected to be completed in early of summer of 2002.