Cracker Barrel shareholders appear to have rejected Sardar Biglari’s move to join the restaurant chain’s board, but stopped short of passing a “poison pill” plan that would deter outside investors from taking over the business.
The Tennessee-based company released preliminary results of investors’ proxy vote Tuesday morning following its annual meeting.
Biglari, the 34-year-old Texas hedge fund investor who controls Steak n Shake parent Biglari Holdings Inc., has been embroiled in a proxy battle with Cracker Barrel Old Country Store Inc. since acquiring enough shares to become its largest shareholder.
He asked directors to appoint him and business partner Phil Cooley to the Cracker Barrel board, saying the down-home chain isn’t living up to its potential.
Biglari had more success with a similar play at Steak n Shake. He began buying shares of the Indianapolis-based burger chain in 2007 and rose to CEO scarcely a year later. Now it is the centerpiece of Biglari Holdings Inc., which also owns Western Sizzlin.
Earlier this month, Cracker Barrel sent a letter to shareholders, asking them to support the company’s board nominees. Officials had warned that electing Biglari to the board “would create serious and inappropriate business conflicts of interest,” given his holdings in competing restaurants.
The company also floated a “shareholders rights” plan, intended to prevent investors from seizing control of the company.
That initiative did not receive enough votes to pass, Cracker Barrel said.