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FOODMAKER REACHES AGREEMENT WITH W.R. GRACE TO ACQUIRE REG

 SAN DIEGO, July 6 /PRNewswire/ -- Foodmaker Inc. (NYSE: FM), Apollo Advisors L.P. and Leonard Green & Partners L.P., (the "investors") announced today that they have reached an agreement with W.R. Grace & Co., the majority shareholder of Restaurant Enterprises Group (REG), to acquire REG.
 "We are very pleased to have the support of Grace," said Jack Goodall, president and chief executive officer of Foodmaker. "With today's announcement, we are a step closer to completing the transaction, which we believe is in the best interest of REG, its security holders and its trade creditors, as well as Foodmaker shareholders."
 Under an agreement signed with Grace, the investors intend to combine REG and CHI-CHI'S, the Mexican restaurant division of Foodmaker. Foodmaker will contribute CHI-CHI's in exchange for a 33 percent equity position and cash to be raised through issuance of notes. Apollo Advisors and Leonard Green & Partners, through one or more managed entities, will contribute cash and hold a 67 percent equity position.
 The agreement requires that the transaction be completed in the course of a pre-packaged REG bankruptcy proceeding under Chapter 11 of the U.S. Bankruptcy Code. Pending certain conditions, the transaction is expected to close in late 1993. No other details of the transaction were disclosed.
 REG, based in Irvine, Calif., currently owns, operates and franchises various restaurant chains, including Carrows, Coco's and El Torito.
 Foodmaker is also the owner, operator and franchisor of the 1,165-unit JACK IN THE BOX restaurant chain, located primarily in the western and southwestern United States.
 Leonard Green & Partners L.P. is an investment firm based in Los Angeles specializing in management buyouts. Apollo Advisors L.P., through its affiliates, manages and directs private investment funds with capital in excess of $4 billion.
 -0- 7/6/93
 /CONTACT: Gina Devlin or Chuck Duddles of Foodmaker, 619-571-2248/
 (FM)


CO: Foodmaker Inc.; W.R. Grace & Co.; Restaurant Enterprises Group ST: California IN: LEI SU: TNM

BP-JL -- SD003 -- 8824 07/06/93 17:50 EDT
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Publication:PR Newswire
Date:Jul 6, 1993
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