Arby's announced on Tuesday that it has struck a deal to acquire Buffalo Wild Wings in a $2.9 billion takeover.
Arby's will pay $157 a share in Buffalo Wild Wings stock and will assume the company's debt.
Arby's is majority owned by private equity firm Roark Capital Group, which also has investments in Hardee's, Jimmy John's and other chains. Buffalo Wild Wings shares jumped around 6 percent to $156 in early trading Tuesday.
As a publicly-traded company, Buffalo Wild Wings grew in locations and revenue at one of the strongest rates in the fast casual dining industry.
Buffalo Wild Wings will be a privately held subsidiary of Arby's, whose CEO will stay in that same role for the combined entity. "We are excited to welcome a brand with such a rich heritage".
The agreement has been unanimously approved by both companies' boards of directors.
Arby's is buying Buffalo Wild Wings in what some business leaders are calling a restaurant shakeup. "This transaction provides compelling value to our shareholders".
Buffalo Wild Wings was founded in 1982 and is headquartered in Minneapolis.
Roark is likely to focus first on improving Buffalo Wild Wings' food and operations, which should be easy fixes for a firm that's experienced in the restaurant industry, according to Michael Halen, an analyst at Bloomberg Intelligence.
When Buffalo Wild Wings in 2003 filed to sell shares to the public, it had 217 locations in 27 states, 77 that it owned directly and the rest owned and operated by franchisees.
A leading culprit has been chicken wing prices.
"The last three years there have been a disaster - there's a lot of low-hanging fruit", he said. Restaurant level profit fell from 17.6 percent of restaurant sales during Q3 2016 to 16.6 percent of restaurant sales this year.
Activist hedge fund Marcato Capital Management pressurized on the company to pursue strategies in a bid to boost its stock price.
Smith said in June she planned to retire by year's end, ending a 21-year-era.