Luby’s Has Winning Bid For Fuddrucker’s

In a deal approved last week by a federal bankruptcy court, Luby’s Inc. will acquire most of the assets of burger chain Fuddruckers Inc., its parent Magic Brands LLC and their affiliates for about $61 million in cash. The deal is expected to close by July 26.

The 96-unit Houston-based cafeteria chain also will assume some of Fuddruckers’ real-estate leases and contracts. Luby’s bought the assets in an auction on June 17, two months after Magic Brands filed for Chapter 11 bankruptcy protection. As part of the bankruptcy proceedings, Magic terminated certain Fuddruckers leases and closed 24 corporate-owned restaurants.

Fuddruckers operates 60 eponymous restaurants and three Koo-Koo-Roo locations, while franchisees operate 138 more Fuddruckers sites. The chain was founded in San Antonio, Texas, in 1980. Austin-based Magic Brands purchased the chain in 1998 and had sought to broaden its appeal through menu expansion.

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