Ihop Makes Bid for Applebee’s

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Ihop Corp. has made an offer to buy the struggling restaurant chain Applebee’s International Inc., according to reports Wednesday afternoon.


Ihop’s offer came in the second round of bidding for Applebee’s after the company put itself up for sale in February, Bloomberg News reports. Financial details of the deal were not known.


Ihop, based in Glendale, owns and operates about 1,300 locations in the United States, and has about half of Applebee’s nearly $2 billion market value. Ihop said in February that it may acquire a chain that wasn’t a competitor. The Overland Park, Kan.-based restaurant chain operates about 1,900 casual-dinning restaurants, but does not directly compete against Ihop, which is strongest in the breakfast sector.


Applebee’s profits have dropped eight straight quarters, hitting a low this past quarter. Ihop also saw a dip in profits for the past quarter; however, the company posted a slight increase in sales and has seen its shares gain more than 26 percent over the past year.


Shares in Applebee’s gained nearly 4 percent, or 97 cents, Wednesday on news of the possible transaction. Applebee’s is valued at about $1.92 billion and is traded on the Nasdaq.


Shares in Ihop closed down 19 cents Wednesday on the New York Stock Exchange and continued to slip in after-hours trading, dropping another 52 cents to $55.29.

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