Denny’s Corporation, parent of 24-hour diner chain Denny’s and breakfast cafe Keke’s, is set to go private after signing a $620 million deal with its buyers.

The buyer group includes New York-based private equity investment firm TriArtisan Capital Advisors, alternative assets investment company Treville Capital Group, and Yadav Enterprises – one of the largest Denny’s franchisees.

TriArtisan brings deep experience investing in full-service, global dining and entertainment concepts, such as PF Chang’s. Yadav owns and operates approximately 550 restaurants nationwide, including a network of Denny’s locations, with a 30-plus-year experience. 

Under the terms of the agreement, Denny’s stockholders will receive $6.25 per share in cash. The price represents a 52.1 per cent premium to Denny’s’ closing stock price on Monday and a 36.8 per cent premium to its 90-day volume-weighted average share price.

Denny’s Corporation CEO Kelli Valade said the transaction is fair to and in the best interests of stockholders and represents the best path forward for the company.

“After receiving indications of interest from TriArtisan, the board conducted a thorough review of strategic alternatives to maximize value with the assistance of external advisors. 

“As part of the review, the company reached out to more than 40 potential buyers and ultimately received multiple offers,” Valade said.

The transaction is expected to close in the first quarter of next year. Upon completion, Denny’s common stock will no longer be listed on Nasdaq.

The announcement comes as Denny’s Corporation reported a steep decrease in third-quarter net income, which went down from $6.5 million in the year-ago period to about $630,000. 

The company saw a modest 1.2 per cent increase in sales for the quarter, primarily driven by new Keke’s locations and partially offset by the planned closures of lower-volume Denny’s franchised restaurants.

Denny’s domestic same-restaurant sales were down 2.9 per cent, while Keke’s domestic same-restaurant sales rose 1.1 per cent.

The company ended the quarter with $269.2 million of total debt outstanding, including $259.5 million of borrowings under its credit facility. 

As of September 24, Denny’s Corporation consisted of 1537 restaurants, including 1452 franchised and licensed restaurants and 85 company-operated locations.