The owner of Arby's, Hardee's and Jimmy John's has offered to buy Buffalo Wild Wings and take it private, five months after an activist investor won strategic control of the company, the Wall Street Journal reported late Monday.
Roark Capital of Atlanta offered about $150 a share, or $2.3 billion, for Buffalo Wild Wings, the Journal said, citing people familiar with the offer. That's a 28 percent premium to Monday's closing price of $117.25 for Buffalo Wild Wings shares. The shares soared to $150 in after-hours trading.
But the offer is below the price of Buffalo Wild Wings shares before the activist investor, Mick McGuire of San Francisco-based Marcato Capital, won a proxy battle at the company's annual meeting in early June. And it is well below the $300 price McGuire told investors he could lead the company to over the next few years.
The offer was sent to Buffalo Wild Wings in recent weeks, the Journal said. Neither firm has disclosed it publicly, but the Journal said both have hired investment bankers to advise them on a transaction.
Representatives of Buffalo Wild Wings did not respond to requests for comment on the report and there was no immediate word from McGuire. A spokeswoman for Roark declined to comment.
Buffalo Wild Wings shares last traded above $150 on May 26, about a week before the annual meeting. When McGuire won the proxy fight and seats on the company's board, Buffalo Wild Wings Chief Executive Sally Smith announced she would retire from the company by the end of the year.
Smith, who has been chief executive since 1996 and built the company into a 1,200-unit chain, has continued to lead the company as its board searched for a successor. She said last month that she expects the board to make a statement to investors about its progress before the end of the year.
During the proxy battle, McGuire said he aimed to lift Buffalo Wild Wings shares to more than $300 a share in coming years by divesting a portion of the company's real estate holdings and making other changes. However, he has said little about Buffalo Wild Wings since then and the company's shares tumbled to as low as $98.40 in September.
McGuire started acquiring shares in Buffalo Wild Wings in summer 2016, when its shares largely traded above $150 and reached as high as $168. His investment firm eventually built up a 6 percent stake.
Roark owns Focus Brands, the parent of Cinnabon, Auntie Anne's and Schlotzsky's. It also owns the fast-growing Naf Naf chain. It bought Arby's in 2011; CKE Holdings, the parent of the Carl's and Hardee's hamburger chains, in 2013; and Jimmy John's last year. It has a minority stake in Wisconsin-based Culver's.