Darden Restaurants has sold Red Lobster for $2.1 billion to private-equity firm Golden Gate Capital. The struggling restaurant chain has yet to recover from the recession and rising shrimp prices have curtailed profits. Darden Restaurants plans on paying more attention to the Olive Garden franchise, which is also struggling.
Golden Gate Capital already owned California Pizza Kitchen and On the Border before purchasing Red Lobster. Darden announced it would spend over $1 billion of it’s profit in the sale on paying off debts. Sales in the company slumped 3% after the announcement of the sale and activist economists voiced their opposition.