Pinstripes Inc., the restaurant chain that combines bowling and bocce with Italian fare, is going public in a merger with a blank-check company at a pro forma enterprise valuation of about $520 million, according to people familiar with the matter.
The transaction with Banyan Acquisition Corp. includes a $20 million equity investment from Middleton Partners, the people said asking not to be identified because the information wasn’t public. An agreement could be announced as soon as Friday, the people said.
Once the deal with the special purpose acquisition company, or SPAC, is completed, Pinstripes will trade on the New York Stock Exchange under the symbol PNST, they added.
The deal not only follows the SPAC tidal wave that has receded in the past year, it comes as the the long-frozen market for initial public offerings is just beginning to thaw, with listings such as Mediterranean restaurant chain Cava Group Inc. leading the way.
Unlike many of the startups that have gone public either through SPAC mergers or IPOs, Pinstripes is profitable, the people said. For 2024, the company is projected to have earnings before interest, taxes, depreciation and amortization of $30 million to $33 million on revenue of $185 million to $195 million, according to the people.
Pinstripes has 13 locations in eight US states and the District of Columbia, with six more under construction in Florida, California and New Jersey, according to its website.
It’s one of several chains in the so-called eatertainment category, restaurants that provide activities such as golf, ping pong and tetherball, among other games.
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Pinstripes Chief Executive Officer Dale Schwartz, who opened its first location in 2007 in Northbrook, Illinois, will continue to lead the company, the people said. Schwartz’s career has included founding an asphalt sealcoating company and leading a biotechnology company to working as an analyst in Morgan Stanley’s mergers and acquisitions department and later as a principal at Odyssey Partners, the Pinstripes website shows.
Banyan, led by Chairman Jerry Hyman and CEO Keith Jaffee, raised almost $242 million including so-called greenshoe shares in January 2022. With redemptions and following a shareholder vote in April to extend its deadline to complete a merger, the SPAC, also based in Northbrook, has a market value of about $117 million.