- It's a see-saw early session for Darden Restaurants (DRI) following news the company will sell Red Lobster for $2.1B.
- The company is taking the unusual measure of funneling the proceeds back to buybacks and debt retirement which is a tip-off to some that more dramatic changes are on the way.
- The deal price seems a bit low to some restaurant industry analysts, although the sale comes amid sluggish traffic patterns at Red Lobster. There's also the difficulty of uncoupling the combined Red Lobster-Olive Garden units.
- What to watch: Darden CEO Clarence Otis has been the target of activist investors and analysts for quite a while on accusations of mismanagement. If early reaction is any indication, Otis is still firmly on the hot seat.
- DRI -1.3% premarket
at CNBC.com (Nov 18, 2014)