Fairfax closes deal with Imvescor

MONCTON, NB—Toronto-based Fairfax Financial Holdings Limited closed a deal last week to invest $25 million in Imvescor Restaurant Group, which could see Fairfax holding nearly 40 per cent of the restaurant company.

Fairfax bought five-year debentures from Imvescor, as well as five-year warrants to purchase common shares. Fairfax also bought a private placement of 5.6 million common shares, representing 13.6 per cent of outstanding common shares.

If Fairfax exercises the warrants, as things stand now, it will own about 38 per cent of Imvescor’s common stock.

With its investment in the restaurant company, Fairfax will get at least 40 per cent of the seats on Imvescor’s board, including that of the chair, provided that there is always a majority of independent directors.

Imvescor owns franchised and corporate restaurants across Canada under four brands: Pizza Delight (primarily in Atlantic Canada), Mikes and Scores family and casual dining restaurants (primarily in Quebec), and the casual dining chain Bâton Rouge which operates in Quebec, Ontario and Alberta.

Fairfax is an insurance holding company which occasionally invests in other industries.

In November, Prime Restaurants Inc. accepted a $71-million buyout offer from Fairfax, in a deal expected to close early in 2012.

Prime owns and operates East Side Mario’s and Casey’s casual dining chains, as well as the Prime Pubs division which has Fionn MacCool’s, D’Arcy McGee’s, Paddy Flaherty’s, Tir nan Og and Bier Markt restaurants.