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Business

Buffalo Wild Wings CEO is leaving as activist wins board seats

By
Carleton English
Published June 2, 2017, 3:09 p.m. ET

Activist investor Mick McGuire scored major wins at Buffalo Wild Wings.

The wings-and-beer chain announced Friday that longtime CEO Sally Smith would be stepping down by year-end. Meanwhile, McGuire’s Marcato Capital said that three of the hedge fund’s four nominees won spots on the Buffalo Wild Wings board.

Shares of Buffalo Wild Wings, which trade on the Nasdaq under the ticker “BWLD”, jumped more than 3 percent to $154.80 on the news.

“We are very pleased that our fellow BWLD shareholders recognize that additional change on the Board is warranted to return Buffalo Wild Wings to a path of growth and long-term value creation,” McGuire said Friday.

Success was not always certain for McGuire.

Since the Bill Ackman protege announced a 5.6 percent stake in Buffalo Wild Wings last July that has since grown to 9.9 percent, analysts and proxy advisory firms were split on whether the hedgie’s demands — which included Smith’s exit, board refreshment, and franchising 90 percent of the company’s 1,200 locations — were appropriate.

Adding more tension to the situation, Friday’s shareholder meeting was delayed by an hour, which sent shares down more than 3 percent as traders speculated about the reason for the delay.

But the losses turned around sharply after Buffalo Wild Wings announced that Smith, who had been at the helm of the company for more than 20 years, was leaving.

“I am proud of Buffalo Wild Wings’ tremendous success. We have made great strides in executing our strategic plan and continuing to innovate to stay ahead of the competition,” Smith said in statement Friday.