Darden Restaurants, the Florida-based company that owns Longhorn Steakhouse, Olive Garden, Bahama Breeze, and Seasons 52, among others, has announced the sale of one of their bigger chains, Red Lobster.
Darden announced on Friday that they've agreed to sell the restaurant and related real estate assets to San Francisco-based Golden Gate Capital for $2.1 billion.
Red Lobster has been struggling for some time, and Darden is selling, for the most part, to help pay off some company debt.
The $2.1 billion transaction will be done in all cash.
According to Market Watch, Darden will be receiving net cash proceeds of $1.6 billion, after tax and transaction costs. About $1.0 billion of that will be used to payoff outstanding debt.
The company, which is based out of Orlando, will use the rest of that money -- about $500 million to $600 million -- to buy back shares in a new share repurchase program of up to $700 million in fiscal 2015.
Shares of Darden fell 0.87% in pre-market trading to $50.25, according to Market Watch.
"Today's announcement is the culmination of a highly competitive process designed to maximize the value of the Red Lobster business and better position Darden for success," Lead Director of Darden's Board of Directors, Chuck Ledsinger, said in a statement.
"The structure of the agreement enables us to capture the value of Red Lobster and establish a market validated valuation of its real estate, while also enabling us to avoid the risks associated with continuing to operate the business in the current challenging environment. As we move forward, we remain committed to building on Darden's leadership and will continue to focus on optimizing all of the Company's assets, including its real estate."
The sale comes just days after Darden laid off workers at its Orlando headquarters.
On Wednesday, the company announced several layoffs "a handful of departments."
The number of laid off workers this week were not released. But Darden had laid off about 20 workers this year already. That in addition to 85 employees being let go last September.
Darden had been named to the FORTUNE "100 Best Companies to Work For" in consecutive years from 2010-2014.
The $2.1 billion deal with Golden Gate Capital is subject to customary closing conditions and regulatory approvals. It's not subject to a shareholder approval condition or a financing condition.
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