Wagamama bought by Frankie & Benny’s owner The Restaurant Group

TRG said it will convert some of its existing sites into Wagamama branches

The popular Asian-style chain has been valued at £559m (Getty)

Wagamama has been sold to the owner of Frankie & Benny’s, Garfunkels and several other restaurant chains for £357m.

The Restaurant Group (TRG), which also controls the Chiquito and Joe’s Kitchen brands, said its offer valued Wagamama at £559m.

It plans to expand Wagamama throughout the UK, and said it will convert “selected TRG sites” into branches of the Asian-style chain.

TRG said Wagamama will be run as an autonomous division of the combined group.

The company has struggled with sluggish sales at many of its brands, and has sold a number of sites in recent years.

Andy McCue, TRG chief executive, said: “Wagamama is a fantastic brand, with a market leading pan-Asian proposition, which has consistently outperformed the casual dining market in recent years. Central to this success has been a cohesive culture and clear brand values which are focused on making the right choices for customers.

“The transaction not only gives us a great brand but also creates a business with a multi-pronged growth strategy which will enhance earnings with continued selective UK rollout, accelerated via conversions of some TRG sites; by further leveraging the brand in concessions both in the UK and internationally; by maximising the opportunities presented by the rapidly growing delivery sector; and by optimising the potential within international markets.”

AJ Bell investment director Russ Mould said: “Growth is about more than getting bigger and while the deal would add a little under 200 new restaurants to its 509-strong portfolio, there have to be serious question marks over the scope to expand Wagamama – even if it is a successful operator.

“The fact Wagamama is being bought out of private equity ownership is not necessarily a positive either. While it is not always the case, private equity assets can often be underinvested as their owners have looked to squeeze every possible drop of cash out of them. The price paid by The Restaurant Group for the business also looks fairly chunky.”

Investors in TRG appeared unimpressed with the deal, with shares falling as much as 18 per cent in early trading on Tuesday.