Barington Group Announces Retention Of Advisors In Connection With Its Investment In Darden Restaurants

NEW YORK, Nov. 21, 2013 /PRNewswire/ -- A group of shareholders led by Barington Capital Group, L.P. (the "Barington Group") that collectively owns over 2% of the outstanding common stock of Darden Restaurants, Inc. ("Darden" or the "Company") (NYSE: DRI) today announced that it has retained Houlihan Lokey to undertake an independent review of Barington's recommendations to improve the long-term financial performance of Darden.  Once the review is completed, the Barington Group will share its recommendations with Darden and its fellow shareholders in a detailed presentation.  MacKenzie Partners, a leading proxy solicitation, investor relations and corporate governance consulting firm, has also been retained to advise the Barington Group.

On October 17^th, Barington released a copy of the letter it sent to Darden's Board of Directors that summarized the recommendations Barington previously presented to Darden's senior management team in June 2013 to improve long-term shareholder value.  The recommendations include measures to:

• improve operating execution at Darden, which currently manages eight restaurant brands with diverse requirements and has become, in Barington's view, too large and complex of an organization to compete effectively with its more nimble competitors.  Barington recommends, as an initial step, that the Company form two independently managed restaurant operating companies – one for Darden's mature restaurant brands (Olive Garden and Red Lobster) and one for its higher-growth restaurant brands (LongHorn Steakhouse, The Capital Grille, Yard House, Bahama Breeze, Seasons 52 and Eddie V's Prime Seafood) – to enable each restaurant operating company to benefit from a greater focus on the unique requirements of its brands;
• enhance the long-term performance of Darden's mature restaurant brands by, among other things, improving the customer experience, ending future restaurant unit expansion and capturing efficiencies in order to maximize return on capital and sustain shareholder dividends;
• improve the long-term competitiveness of Darden's higher-growth restaurant brands by focusing on building distinctive brands with a loyal customer base, experimenting with new menu options and investing in new unit expansion, while simultaneously evaluating potential brand divestiture or spin-off opportunities;
• help "unlock" the value of Darden's extensive real estate assets, which Barington believes represent a source of significant value that is not adequately reflected in the Company's current stock price; and
• reduce operating expenses by $100 - $150 million a year, which Barington believes can be accomplished through, among other things, streamlining operations, eliminating corporate functions that duplicate brand-level work and improving the cost effectiveness of the Company's advertising spend.

Barington believes that if its recommendations are fully implemented, the price of Darden's common stock could increase by up to 50% over recent trading levels.

James A. Mitarotonda, the Chairman and Chief Executive Officer of Barington Capital Group, commented: "Darden has a collection of eight wonderful restaurant brands and more real estate assets than any other casual dining restaurant company in the United States.  Although Darden's performance has been disappointing over the past few years, we are convinced that the recommendations we shared with the Company's management team in June can meaningfully enhance the long-term profitability of Darden.  While we were encouraged by Darden's recent announcement that it is taking steps to reduce expenses by approximately $50 million a year – a helpful start toward addressing the cost reductions we recommended – we believe there is much more work that needs to be done and in a far more expeditious timeframe.  We have therefore engaged a financial advisor to conduct an independent review of the strategic and operating improvements we recommended, and we are committed to doing whatever we can to assist the Company in improving long-term shareholder value for the benefit of all Darden shareholders."

About Barington Capital Group, L.P.

Barington Capital Group, L.P. is an investment firm that, through its affiliates, manages a value-oriented, activist investment fund that was established by James A. Mitarotonda in January 2000.  The Fund invests in undervalued publicly traded companies that Barington believes could appreciate significantly in value as a result of a change in corporate strategy or from various operational, financial or corporate governance improvements.  Barington's investment team, senior advisors and industry contacts are seasoned operating specialists, experienced in working with companies to design and implement initiatives to improve their financial and share price performance.  Barington is a frequent investor in branded consumer focused companies, with prior investments in companies such as Lone Star Steakhouse, Dillard's, Warnaco, The Jones Group, Lancaster Colony, Pep Boys, Steven Madden and Nautica.

SOURCE Barington Capital Group, L.P.