Shares in Wagamama owner The Restaurant Group soared 37% after announcing that it was being acquired by an Apollo Global Management-owned vehicle for £506 million in cash.

TRG shareholders will receive 65 pence for each share held, representing a premium of about 34% to the stock’s last closing price.

The company’s directors have unanimously recommended that shareholders vote in favour of the deal, which has an enterprise value of £701m.

TRG has struggled with losses and announced in September that chairman Ken Hanna would step down after months of pressure from activist investors to change management and improve profitability.

Mr Hanna said the board was “cognisant of the premium and the certain value of the Apollo offer against the backdrop of a challenging macroeconomic environment”.

TRG last month agreed to sell its loss-making Frankie & Benny’s and Chiquito brands to Cafe Rouge owner Big Table Group in a bid to bolster margins and cut debt.

Apollo, which this year failed with an offer for Wood Group, said it believes the development of TRG will be best served as a private business, with access to capital and the benefit of a long-term investment approach.