MONSEY, N.Y., April 01, 2024 (GLOBE NEWSWIRE) -- The law firm of Wohl & Fruchter LLP has renewed its investigation into the fairness of the price of $9.55 per share in cash for which Carrols Restaurant Group, Inc. (Nasdaq: TAST) (“Carrols”) has agreed to be sold to Restaurant Brands International Inc. (“RBI”), the parent company of Burger King.
Carrols is the largest Burger King franchisee in the United States. Affiliates of RBI and Burger King own 100% of Carrols Series D Convertible Preferred Stock, which is presently convertible into 9,414,580 shares of Carrols common stock, or 14.6% of Carrols outstanding common shares as of March 1, 2024. These affiliates have special rights, as detailed below.
The investigation of the proposed sale was renewed upon the filing of a preliminary proxy by Carrols concerning the proposed sale on March 4, 2024.
If you remain a Carrols shareholder and question the fairness of the price, you may contact our firm at the following link to discuss your legal rights at no charge:
https://wohlfruchter.com/cases/carrols-restaurant-group/
Alternatively, you may contact us by phone at 866-833-6245, or via email at alerts@wohlfruchter.com.
Why is there an investigation?
On January 16, 2024, Carrols announced that it had agreed to be sold to RBI for $9.55 per share in cash, upon the approval of a Special Committee of the Carrols Board of Directors.
On March 4, 2024, Carrols filed a preliminary proxy (“Proxy”) concerning the proposed sale with the Securities and Exchange Commission.
Carrols is the largest Burger King franchisee in the United States. According to the Proxy, affiliates of RBI and Burger King own 100% of Carrols Series D Convertible Preferred Stock, which is presently convertible into 9,414,580 shares of Carrols common stock, or 14.6% of Carrols outstanding common shares as of March 1, 2024.
These affiliates have special rights, including the right to elect two members of the Carrols board of directors, and to approve any merger or engaging in any business other than the ownership and operation of Burger King and Popeyes restaurants.
According to the Proxy, one of the factors cited by the Special Committee for approving the sale is that RBI’s consent, as franchisor, would be required in order for Carrols to acquire additional Burger King franchise locations and there is a likelihood that RBI may not permit Carrols to acquire a significant number of additional Burger King franchise locations, which the Special Committee believed would limit Carrols’ growth prospects.
This factor raises a concern as to whether any coercion caused the Special Committee to recommend the proposed sale at a sub-optimal price.
“We are investigating whether the Special Committee of the Carrols Board of Directors acted in the best interests of Carrols shareholders in approving the sale,” explained Joshua Fruchter, a founding partner of Wohl & Fruchter. “This includes whether there was any coercion, as well as whether all material information regarding the transaction has been fully disclosed.”
Notably, according to TipRanks, the sales price agreed upon is below the pre-announcement price targets of $10.00 per share of two analysts: Joshua Long at Stephens, and Jake Bartlett of Truist Financial.
About Wohl & Fruchter
Wohl & Fruchter LLP has for over a decade been representing investors in litigation arising from fraud and other corporate misconduct, and recovered hundreds of millions of dollars in damages for investors. Please visit our website, www.wohlfruchter.com, to learn more about our Firm, or contact one of our partners.
Contact:
Wohl & Fruchter LLP
Joshua E. Fruchter
Toll Free 866.833.6245
alerts@wohlfruchter.com
www.wohlfruchter.com
