Marcato Presses for Changes at Buffalo Wild Wings
August 17 2016 - 1:00PM
Dow Jones News
Activist investor Marcato Capital Management LP on Wednesday
said it is seeking substantial changes at sports-bar chain Buffalo
Wild Wings Inc., including the addition of new management and
improvements in food quality and service.
In a letter to Buffalo Wild Wings Chairman James Damian, the
activist investor criticized the restaurant company's
decision-making processes regarding capital deployment and its
"tendency to favor gut feel and thematic proclamations" that lack
"tangible evidence or appropriate analytical support."
Marcato also said that roughly two months had passed since its
initial private talks with the fast-casual chain's management, and
that it was disclosing its views after the company's "lackluster
analyst day presentation and observable discontent among
shareholders and research analysts."
A company spokeswoman wasn't immediately available to
comment.
The San Francisco hedge fund, which has a 5.2% stake in Buffalo
Wild Wings, also said the company needs to remain focused on its
main business rather than "placing wild bets, however small, on
hit-or-miss 'growth drivers.'" Marcato is run by Mick McGuire, a
proté gé of activist William Ackman.
During July, Buffalo Wild Wings reported a decline in same-store
sales for the second consecutive quarter, though the decline was
offset by a rise in revenue, propelled by the addition new
locations.
Buffalo Wild Wings shares, down 17% in the past 12 months, rose
2.2% to $164.95 in recent trading.
Write to Tess Stynes at tess.stynes@wsj.com
(END) Dow Jones Newswires
August 17, 2016 12:45 ET (16:45 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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