An Outback Steakhouse truck sits parked outside a restaurant in Latest York.
Daniel Acker | Bloomberg | Getty Images
Shares of Outback Steakhouse owner Bloomin’ Brands rose 8.7% Friday after an activist investor disclosed its interest within the restaurant company.
Starboard Value now owns 9.9% of Bloomin’s shares, according a regulatory filing. Starboard believes Bloomin’ is undervalued, CNBC’s Sara Eisen reported, citing sources. The restaurant company has a market value of $2.43 billion, as of Friday’s close.
In recent quarters, Bloomin’s sales growth has slowed. Earlier in August, the corporate reported that its U.S. same-store sales grew just 0.8% within the second quarter as traffic to its restaurants shrank.
Along with Outback, Bloomin’ also owns Carrabba’s Italian Grill, Bonefish Grill, and Fleming’s Prime Steakhouse and Wine Bar.
It’s unclear what changes Starboard plans to push for at Bloomin’ Brands at this point. Past activists investors targeting the corporate, including Jana Partners and Barington Capital Group, have tried to pressure Bloomin’ to chop costs and spin off a few of its brands.
Starboard Value has a proven track record of successful turnarounds at restaurant corporations. In 2014, Starboard took control of Darden Restaurants’ board and implemented plenty of changes, like improving Olive Garden’s breadsticks, that helped boost sales and the stock.
More recently, the firm struck a take care of Papa John’s in 2019 because the pizza chain sought to finish a feud with disgraced founder John Schnatter and revive sinking sales attributable to his scandals. Earlier this 12 months, Starboard CEO Jeff Smith stepped down as chairman from Papa John’s board, and the corporate bought back many of the investment firm’s shares.
