Claim Jumper founder Craig Nickoloff said he and a group of investors plan to make a bid for the 45-unit casual-dining chain in a bankruptcy auction scheduled for Thursday.
Houston-based Landry’s Restaurants Inc. has also maintained that its bid for Claim Jumper is the best offer, and continues to raise questions about the fairness of the auction process.
The stalking horse bidder going into the auction, however, is Private Capital Partners, an affiliate of investment firm Canyon Capital Advisors LLC and an investor in the company.
After upping its bid to match that of Landry’s, Private Capital’s offer totals $56.15 million, including a cash bid of $27 million and the assumption of liabilities.
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Landry's counters investor's offer to buy Claim Jumper
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Irvine, Calif.-based Claim Jumper Restaurants filed for Chapter 11 on Sept. 10 in the U.S. Bankruptcy Court in Delaware, and said it planned to sell most of its assets to Private Capital. In court filings, Claim Jumper officials said the chain was hit hard by the economic downturn at a time when the company had deepened its debt with rapid expansion.
Claim Jumper officials are expected to announce which bid is deemed the highest and best offer late Thursday, and the proposed purchase is scheduled to be submitted to the bankruptcy court on Nov. 2.
Nickoloff, who opened the first Claim Jumper in 1977, remained a shareholder after selling a majority stake in the company in 2005 to Los Angeles-based private-equity firm Leonard Green & Partners LP for an estimated $220 million.
Though he said he planned to make a bid, Nickoloff said late Tuesday that he could not give details on the offer.
According to court filings, Nickoloff has made two offers to buy back Claim Jumper since 2009, but the casual-dining company twice selected bids by Black Canyon Capital Partners, a current debt holder in Claim Jumper and an affiliate of Private Capital Partners. However, an agreement with Black Canyon was never reached.
Both Nickoloff and Landry’s Restaurants have raised objections about the transparency of the auction process.
In its most recent objection filed Friday with the bankruptcy court, Landry’s reiterated its argument that its bid remains “significantly higher and better,” and expressed concern that the metrics for evaluating competing bids have not been clearly defined.
Landry’s said it reserves the right to seek emergency relief from the court and to raise further objections if a “fair and even standard” is not demonstrated in determining the best offer for the chain on Thursday.
Contact Lisa Jennings at [email protected].