Schroders plans to support the Restaurant Group’s proposed £600m Wagamama deal

Schroders, a top 10 shareholder in the Restaurant Group, has come out in support of the Frankie and Bennies owner’s acquisition of Wagamama.

It comes as several major investors announced they would oppose the deal at a meeting next week, saying the £600m price tag is too steep.

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

“We see the proposed acquisition of Wagamama as a very positive move for the Restaurant Group and are therefore supportive of the deal.”

Royal London Asset Management, which holds 5.7 per cent of the shares, and J O Hambro have also backed the proposals.

However Columbia Threedneedle Investments, the owner of a 7.7 per cent stake, plans to vote down the plans on 28 November, along with another top 10 shareholder, which declined to be named.

Columbia Threadneedle equities fund manager James Thorne said the “size and price of the deal at this point in the cycle throws up too many red flags”.

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

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