Monday, 27 April 2015
Last updated 2 hours ago
Apr 23 2014 | 10:13am ET
Hedge fund Starboard Value may get its chance to block Darden Restaurants’ plan to spin off its Red Lobster chain.
The activist said it had won the backing of 54% of Darden shareholders to force a special meeting and a vote on the spin-off plan. Darden has said that the vote would not require a shareholder poll on the Red Lobster plan. What’s more, the company has 60 days to set a date for the meeting and another 60 to actually hold it, which could mean it will present investors with a fait accompli: Darden has said it wants to spin-off or sell Red Lobster early in its next fiscal year, which begins in just over a month.
Starboard has called Darden’s plan “ill-conceived and potentially value destructive.” Instead, the hedge fund wants Darden to split into three companies, with Red Lobster and the Olive Garden composing one, Darden’s faster-growing chains another and a real-estate investment trust the third.
Starboard has said it will seek the ouster of Darden’s board if the company moves forward with its plan without a vote.
“The Red Lobster separation doesn’t make a lot of sense,” Starboard’s Jeffrey Smith told CNBC. “Shareholders are voicing their opinions very strongly that they are not in favor. Research analysts have been against this separation.”
“You would think management and the board would have gotten the message long before now that change is required.”
Mar 20 2015 | 12:45pm ET
StreetWise Partners, a non-profit organization that works with low-income individuals to help them overcome employment barriers, raised over $275,000 at the 2015 Raising the Ante Charity Poker Tournament and Casino Event last Wednesday evening at Capitale. Here are some photos from the event. Read more…