Luby’s Inc. recently entered into an agreement to sell the Luby’s Cafeteria restaurant business to a newly formed affiliate of Calvin Gin. The purchase by the Gin affiliate (to be renamed Luby’s Restaurants Corporation following closing of the transaction) will include 32 of the existing locations of Luby’s restaurants, all in Texas, and ownership of the Luby’s Cafeteria brand.

The acquisition of the Luby’s cafeterias business does not include any of the real estate owned by Luby’s, nor does it include any of the company’s Fuddruckers operations or the Culinary Contract Service business. The structure of the transaction will allow Luby’s to sell its real estate related to its cafeteria restaurant business to third parties and realize the related value for its shareholders.

It is anticipated that the Luby’s Cafeteria operations sale transaction could provide Luby’s with approximately $28.7 million of value (all but a nominal amount of which will be derived from the purchaser’s assumption of Luby’s liabilities and the purchaser’s issuance of notes to Luby’s).

The sale of the Luby’s Cafeteria operations is another step in the execution of the previously announced plan of Luby’s to sell its assets, pay its liabilities and return the remaining cash to shareholders under the company’s previously announced plan of liquidation and dissolution approved by its shareholders on November 17, 2020. The parties anticipate the transaction will close before the end of the company’s current fiscal year.