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A protracted and potentially heated takeover battle is now expected following the big American McCormick & Schmick's Seafood Restaurant chain rejection at the weekend of a bid from its main rival, Landry's Restaurants.
McCormick & Schmick's has issued a statement saying its board of directors unanimously turned down the offer. It may be weeks before the issue is resolved.
Tilman J. Fertitta, the owner and founder of Landry's had offered $9.25 per share in a deal worth $137 million. Landry's said afterwards that it was not going to give up on its bid and was planning to launch a proxy fight. The deadline for Ferititta's offer is now being extended from May 6th to May 31st. He currently holds about 10 per cent of McCormick & Schmick's.
McCormick & Schmick's written statement said the Landry's offer under- valued the company's business, was "opportunistically timed to take advantage of a trough in the company's stock price", places stockholders at risk that the offer will never be consummated and cited other reasons for rejecting the offer.
Steven Scheinthal, executive vice president and general counsel of Landry's, said Fertitta believes the board is not acting in the interest of shareholders and has filed a preliminary proxy with the Securities Exchange Commission.
McCormick & Schmick's has given Americans a real taste for seafood over the past 35 years. It was started in the 1970s. Since they teamed up, Bill McCormick and Doug Schmick have established more than 80 restaurants throughout the country.
Landry's first restaurant opened in the town of Katy, Texas in 1980 and has continued to grow from coast-to-coast specialising in seafood, but offering a wide range of non-fish dishes as well. The chains includes popular names such as 'Landry's Seafood House',' Willie G's Seafood & Steak House' and 'The Crab House and More'.
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