New York-based activist hedge fund Starboard Value has seemingly identified it’s next restaurant sector target after a recent SEC regulatory filing revealed that the fund has acquired minority stake in Bloomin’ Brands which gives it nearly 10% of voting rights at the Tampa-based business.
Starboard has already instigated major overhauls at Italian family dining chain Olive Garden and pizza delivery business Papa John’s, and Bloomin’s Outback Steakhouse and Carrabba’s Italian Grill brands could be next on the hedge fund’s makeover menu.
In an interview with CNBC last month, Starboard CEO and founder Jeff Smith hinted that the firm was looking to re-enter the restaurant sector saying that the firm had identified several opportunities arising from “underpriced stocks”.
With a price-to-earnings ratio around half of the restaurant industry’s average, Bloomin’ Brands, which has a $2.4bn market capitalisation and $4.4bn in annual revenue, seems to fit that description.
