The activist investor who battled Buffalo Wild Wings three years ago has closed his investment firm after losing nearly all of its assets.
Richard "Mick" McGuire began notifying investors late last week that he was closing the hedge fund, Marcato Capital Management of San Francisco, Reuters and CNBC reported.
Earlier this year, the Wall Street Journal reported that Marcato's asset base had shrunk to $250 million from $3.2 billion in 2015 due to poor investment performance and redemption requests from investors. By the end of September, Marcato held investments of $128 million, according to a regulatory filing.
A spokesman for Marcato couldn't be reached Tuesday.
McGuire was a partner in William Ackman's Pershing Square Capital Management before starting Marcato in 2010. Like Ackman, he gathered investors' money to buy sizable stakes in companies and force them to make strategic or management changes that lifted market value. He would then sell its stake at a profit.
In the summer of 2016, he began building a position in Buffalo Wild Wings, the Golden Valley-based restaurant chain that grew quickly during the late 1990s and 2000s. McGuire began to publicize a plan he said would triple the value of Buffalo Wild Wings shares, which were trading around $150 at the time.
McGuire wanted Buffalo Wild Wings to sell most of its company-owned restaurants to franchisees. Its mix of franchisee- and company-owned units would shift from 50-50 to 90-10. Buffalo Wild Wings would end up chiefly with real estate holdings that could be sold to enrich its shareholders, McGuire reasoned.
Chief Executive Sally Smith, who had built the firm from a few dozen restaurants to more than 1,200, took some steps to implement McGuire's ideas. But he didn't feel she moved fast enough and launched a proxy fight for seats on the company's board in 2017.