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Cara owns brands such as Swiss Chalet, Harvey’s and Milestones.

Shares of Cara Operations Ltd. sizzled on Friday as the restaurant operator soared through its first day of trading, enriching stakeholders' portfolios.

The Vaughan, Ont.-based company made its Toronto Stock Exchange debut Friday after a red-hot initial public offering that was about 20 times oversubscribed. Investors in North America and overseas had scrambled to bite off a piece of the business, which owns brands such as Swiss Chalet, Harvey's and Milestones.

That appetite for shares exceeded some of Canada's most successful IPOs such as Tim Hortons and Dollarama Inc.

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And investors have seen Cara before. The company, which has its roots in a family business founded in 1883, was taken private in a leveraged buyout in 2004, which loaded it up with debt.

A decade later, Cara bought Prime Restaurants Inc. – parent of East Side Mario's and a chain of Irish pubs – from Fairfax Financial Holdings Ltd., which then aided in the recapitalization effort.

The soaring stock price on Friday was a win for early investors who bought shares for $23 each in the IPO, but it was also a major benefit for Cara's chief executive Bill Gregson, who was brought in to turn the troubled restaurant operator around. On top of his annual salary and bonus, the CEO's compensation package included stock options that would make him $94.4-million wealthier, based on Friday's closing share price of $32.90.

That is made up of $35.4-million worth of options with a one-cent exercise price, as well a second tranche of options with a strike price of $8.51, now worth $59-million. But that money is locked for now, since the options don't begin to vest until Oct. 31.

The shares hit a $33.07 high in the late afternoon, before settling out to close at $32.90 on Friday.

There were two key reasons for the initial popularity of the shares, according to investment bankers who worked on the IPO deal. The first is the ability of respected stakeholder Fairfax Financial Holdings Corp. and the management team to tell the story of the company's turnaround, and the clear growth objectives to expand Cara's business. Cara wants a bigger piece of the fragmented Canadian restaurant industry, which Statistics Canada said sold $47.9-billion worth of food and drinks as of 2013.

The second factor was the appetite for non-resource exposure and consumer-oriented growth companies at a time where the energy and materials sectors of the TSX are highly volatile.

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Quick out of the gate, it will now be up to Cara to prove it can expand sales at its restaurants. The company's goals include boosting top-line sales from existing and new restaurants to between $2.5-billion and $3-billion, up from $1.7-billion in its 2014 fiscal year.

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