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The activist hedge fund that assailed Buffalo Wild Wings made some money, but nowhere near what it projected.

While the timing isn’t exact, we assumed Marcato was as good as a hedge fund could be, buying at the recent bottom and selling at the recent top around their public SEC filings.

The fund led by Mick McGuire first bought shares in May of 2016 at $133 per share. It increased its holdings through a series of purchases through 2016, ending the year with about 950,000 shares and a 5.2 percent stake in Buffalo Wild Wings. That surged to 1.59 million shares between April and May of 2017 for about $150. It harvested some 615,000 shares in May, at $152 per share (assuming a high between SEC filings), pulling $95.7 million and 3.8 percent out of the stake.

The campaign called for a massive refranchising effort, share buybacks and a fresh board. The board did change, but refranchising and buybacks haven’t happened. Without Marcato pushing for either anymore, it’s up to the new ownership group of Roark and leader Paul Brown to decide. Buffalo Wild Wings, Arby’s and a yet-to-be-named brand or brands will soon be linked under the name Inspiring Restaurant Brands led by Brown. Roark hasn’t done much refranchising, but hasn’t discussed future strategies yet.  

As the dust settles, it looks like Marcato made between $22- and $25 million from the activist campaign that brought about Sally Smith’s retirement and the eventual buyout. That’s no chump change, but at about a 7 percent gain for the fund, it’s a far cry from Marcato’s plan to triple the stock price to a projected $358 per share. And how much the fund spent on the campaign hasn’t been disclosed.

Buffalo Wild Wings has found a good home, but the whole saga is a reminder to shareholders: Take activist bluster with a grain of salt because the short-term gain is the activist’s game.

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