Sullivan’s Steak House is no longer part of the family, and now the hedge fund that owns a stake in former parent Del Frisco’s wants to shed it as well.
Hedge fund Engaged Capital, having acquired about 10 percent of Del Frisco’s Restaurant Group’s shares, now plans to push the company to sell itself. Engaged Capital said the Southlake, Texas-based restaurant operator is poorly run and has made ill-advised acquisitions of other restaurant chains, the Wall Street Journal reports, writes Dees Stribling for biznow.com.
The hedge fund made its opinions known in a letter to the company’s board this week. In response, Del Frisco’s board adopted a measure — a so-called poison pill — that dilutes the company’s stock if any one shareholder reaches the point of owning at least 10 percent of the company.
Del Frisco’s, which operates more than 80 restaurants, including Double Eagle steakhouses, Barcelona Wine Bar, bartaco and Del Frisco’s Grilles, has seen its share prices more than halve this year. Even so, during recent earnings calls, Del Frisco’s CEO Norman Abdallah outlined the company’s plans for growth, especially for its Barcelona and bartaco brands.
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