Looks like activist shareholder Sardar Biglari prefers Cracker Barrel CEO Julie Masino to her predecessor, Sandy Cochran.
At least he’s not trying to kick the current chief off the board and out of a job. Instead, he’s tempered his proposal that half of Cracker Barrel’s 10 directors be replaced by himself and associates. Biglari indicated in an SEC filing that he’ll now settle for three seats, including one for himself, and would not oppose extending the term for another year of seven current directors, albeit ones he favors. Those seven suggested carryovers include Masino, along with Chip Wade, CEO of Union Square Hospitality Group, and former Ruth’s Chris president Cheryl Henry.
One of the seven, Jody Bilney, is already affiliated with Biglari and serves on the board of one of his companies. Through those affiliated concerns, Biglari controls about 9.3% of Cracker Barrel’s common shares.
The offer of a compromise didn’t deter the maverick investor from declaring his conviction that Cracker Barrel should spin off its secondary growth concept, Maple Street Biscuit Co., and halt expansion of its namesake brand.
In his previous half-dozen or so attempts to grab ahold of Cracker Barrel’s reins, Biglari called outright for ousting management and changing the company’s overall direction.
This time around, he spelled out exactly where he and his associates would focus their influence. In the SEC filing, he wrote, “We believe the Board will benefit from directors with relevant experience” in six areas:
- Capital allocation;
- Store cannibalization;
- Diagnosing the reasons for traffic declines;
- General and administrative spending;
- Gauging returns on a remodeling program like the one just announced by Cracker Barrel; and
- Brand positioning.
In addition himself, the directors he’s nominated for Cracker Barrel’s board are Milena Alberti-Perez, a media veteran whose most recent executive post was serving as CFO of Getty Images, a photography licensing business; and Michael Goodwin, a former chief technology information officer for PetSmart. Both currently serve on a variety of boards.
Cracker Barrel has not yet responded publicly to Biglari’s new offer, though the board previously advised shareholders that it favors re-electing the whole slate of current seat holders.
Biglari indicated in the SEC filing that attempts to hammer out a cooperation agreement last week and two weeks beforehand were unsuccessful.
Biglari already controls two family restaurant chains: Steak ‘n Shake and Western Sizzlin’. His other businesses include Maxim, a men’s magazine that competes with Playboy, and First Guard Insurance.
The filing also indicates that he has met twice with Masino and members of her team since she took over as CEO in November.
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