Investors show mixed appetite for Wagamama takeover as vote draws near

A shareholder showdown looms over The Restaurant Group’s £559m planned takeover of Wagamama this week, with a number of major investors gearing up to oppose the deal.

The Frankie and Benny’s owner could suffer a shareholder rebellion on Wednesday after several top investors signalled their intentions to vote against the proposed acquisition.

Columbia Threadneedle Investments – a top-five investor which controls a 7.7 per cent stake in The Restaurant Group – said that it would be opposing the Wagamama buyout over concerns around the size and the price of the deal.

Grizzlyrock Capital and Vivaldi Asset Management, which collectively hold 1.9 per cent of shares, have also announced their opposition to management proposals.

While several investors have criticised the high valuation of the deal, The Restaurant Group said that the price was justified by the company’s growth rate and by the cost savings generated by combining the Asian food chain with its own operations.

A number of major shareholders have supported The Restaurant Group this week, with Schroders, Royal London Asset Management and J O Hambro all backing the proposals.

Schroders fund manager Andy Brough said: “The key to great deals is seeing how they can complement and further grow the existing business.”

Despite investor concerns, influential proxy advisors Institutional Shareholder Services (ISS) and Glass Lewis have recommended that shareholders pass the proposals.