Cara stock price soars as parent of Harvey's, Swiss Chalet returns to TSX

A Swiss Chalet restaurant location in Oakville, Ont., is seen on Wednesday, Oct. 22, 2008. (Richard Buchan / The Canadian Press)

TORONTO -- Shares of Cara began trading publicly for the first time in more than a decade on Friday and quickly jumped about 40 per cent above the price set for a $200-million stock offering by the Canadian restaurant company.

Cara shares (TSX:CAO) were as high as $33 after the first hour of trading, which was $10 above the IPO price set by Cara Operations -- owner of the Harvey's, Swiss Chalet and other restaurant chains.

One of the beneficiaries of the stock offering is Bill Gregson, who became Cara's chief executive after Fairfax Financial (TSX:FFH) invested in the company in 2013.

Regulatory documents said he received options to buy about 3.5 million shares by Oct. 31, 2021. The options had a face value of about $118 million at Friday's high price, though Gregson would be required to pay $20.6-million to exercise them, for a total of $94.7 million.

It's a return to Canada's largest stock market for Cara, which was taken private in 2004.

Fairfax Financial Holdings Ltd. (TSX:FFH) and members of the Phelan family will own the company's multiple voting shares, which will carry 25 votes per share -- giving them effective control of the business.

In addition to Harvey's and Swiss Chalet, Cara owns the Milestones, East Side Mario's, Casey's, Kelsey's and Montana's chains.