NEW YORK, February 6 (FinanceEnquiry.com) - O’Charley’s Inc (NASDAQ: CHUX) has entered into a contract with Fidelity National Financial (NYSE: FNF) to merge both the companies. As per the agreement, FNF will acquire of all the outstanding shares of the common stock of O’Charley’s by paying a total of $9.85 per share, which represent a total equity value of nearly $221 million on a fully diluted basis.

The acquisition price shows a premium of roughly 42% to the company’s closing stock price of $6.92 on February 3 and a premium of nearly 57% to the 20-day average trading price of $6.27. The boards of directors of both companies approved the deal unanimously. The contract says that FNF will start a tender offer, whose completion is conditioned on the tender of a number of O’Charley’s, for all the outstanding shares of the O’Charley’s that the buyer does not hold no later than February 24.

Following the closure of the deal, which is not pending for a financing condition and is expected to be completed in the second quarter of 2012, FNF will buy all remaining shares of the company through a second-step merger, which will result in all shares not converted into the tender offer being renewed into the right to receive $9.85 per share in cash. According to the agreement, O’Charley’s is expected to ask for superior proposals from third parties through March 6. On the transaction, O’Charley’s exclusive financial advisor is Evercore Partners, while Bass, Berry & Sims is advising it legally.