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Wall Street remains avid for Chi-Chi's stock. The shares, which at one time sold for 66¢ (after adjusting for splits), closed last week at $27. The explosive run-up has made wealthy men of Chi-Chi's founders, Marno McDermott and Max McGee. McGee, 50, a former star of the Green Bay Packers, now owns some 150,000 Chi-Chi's shares, worth about $4 million, and is a director of the company. McDermott, 44, was chairman until he resigned in February. At that time he held some 330,000 shares of Chi-Chi's, worth about $6 million.
Wall Street magic has also touched Julio and Olivia Garcia, the founders of Garcia's of Scottsdale, Ariz, (fiscal 1981 sales: $11.7 million). The couple parlayed a Mexican-food take-out they opened in 1956 into a fortune that includes some 240,000 shares of Garcia's stock, worth about $1.7 million.
They did it by first building their business into three popular Phoenix-area restaurants called Garcia's and then selling out to Thomas Fleck, a founder of the California-based Cork 'N Cleaver chain, for $3 million in cash and notes in 1979. Fleck went public with Garcia's stock last year and has opened 14 new dining spots from San Diego to Des Moines since he bought the rights to the name. Garcia, 56, retired as chairman a year ago, but his wife, 53, still visits some kitchens and samples sauces.
The hard-charging Mexican chains have carefully catered to regional tastes as they have grown. W.R. Grace's El Torito goes so far as to grind its beef in Southwestern cities like Houston and Dallas and to shred it in San Francisco and Los Angeles, where diners prefer it that way. Says Anwar Soliman, executive vice president for Grace's restaurant group: "You have to look at all these subtleties. It's critical in some places, particularly the Midwest." Soliman predicts that Mexican restaurants will double their business by 1985. Many others are bullish as well. "I don't think it's a fad," says Drexel Burnham's Greditor. "Is pizza a fad?" Says William Trainer, a restaurant analyst for Merrill Lynch: "I think Mexican restaurants have lots of room to grow." Regardless, the onrushing Mexican-food chains have already made tostadas, burritos and the like as familiar and as American as egg foo yung. —By John Greenwald. Reported by Sheila Gribben/Chicago and Janice C. Simpson/New York