Fight wages on between Cracker Barrel, Biglari

Jared Felkins • Updated Oct 25, 2013 at 10:11 AM

Biglari Capital announced Thursday it received a highly confident letter from Jefferies LLC to arrange for debt financing to fund a $20 per share dividend paid to all shareholders of Cracker Barrel Old Country Store.

The letter spells out Sardar Biglari’s highly publicized request for Cracker Barrel to pay a special dividend of $20 per share to shareholders, as well as raise up to $800 million in debt financing to refinance Cracker Barrel’s existing debt and fund the special dividend.

“We are pleased to confirm that Jefferies LLC is highly confident of its ability to arrange the debt financing…” the letter said.

The letter said the debt financing would be subject to satisfactory market conditions and no material adverse change in the business, along with receipt of ratings from Moody’s and Standard and Poor’s, which Jefferies estimated would be B1/B+ credit.

Biglari – the largest individual Cracker Barrel shareholder with about 20 percent of the Lebanon-based company’s stock – and Philip Cooley seek positions on Cracker Barrel’s board of directors. Recently, Biglari sent letters to shareholders and set up a website asking for votes.

Cracker Barrel officials filed last week its fall 2013 investor presentation with the U.S. Securities and Exchange Commission.

The presentation, "Driving Performance: Focused on the Road Ahead," provided an update to investors on the continued strong operational performance and financial results of the company; highlighted the experience and independence of its board of directors; and outlined the reasons why the company believes Biglari Holdings' nominees continue to be the wrong fit for the Cracker Barrel board.

The company reported the presentation is available at its website, and outlined the reasons why the company believes shareholders should vote against the non-binding advisory proposal on a $20 per share special dividend at the company's annual meeting Nov. 13, which was publicly proposed by affiliates of Biglari Holdings. Biglari owns Steak ‘N Shake and Western Sizzlin’.

Recommended for You