Buffalo Wild Wings shareholders approve sale to Arby’s
Buffalo Wild Wings Inc. shareholders voted Friday to sell the company to Arbys Restaurant Inc., sealing a $2.9 billion deal that puts Minnesotas largest restaurant company into a conglomerate.
In a brief meeting at the companys headquarters in Golden Valley, 99 percent of voted shares were cast in favor of the sale.
Shareholders were more split on a nonbinding resolution that recommended compensation payouts to several executives of Buffalo Wild Wings. That measure received support from 54 percent of voted shares.
The deal is expected to formally close Monday or Tuesday, when the Golden Valley company will become a subsidiary of Arbys and be led by Arbys chief executive Paul Brown.
Buffalo Wild Wings investors will be paid $157 for each share they own in the firm. The companys shares were trading around $118 when the offer from Roark Capital Group, the Atlanta investment firm that owns Arbys and more than a dozen other national restaurant chains, was announced.
Through Arbys, Roark has an opportunity to restore momentum to Buffalo Wild Wings, which was working through a leveling-off of growth in 2016 when an activist investor came along and mounted a proxy campaign to impose a new strategy and executive team on it.
At the companys annual meeting last June, shareholders awarded the activist investor several seats on the board and the companys longtime chief executive, Sally Smith, announced plans to retire by the end of the year.
Even before that vote, however, Roark executives had quietly approached Smith and board chairman Jerry Rose expressing interest in a deal. In late June, they disclosed Roarks interest at the first meeting of the new board, which then pursed negotiations that led to the November offer.
Amid all that, Buffalo Wild Wings saw its sales growth slow to 4 percent last year to just over $2 billion. That follows a 9.6 percent increase in 2016 and a 19.5 percent increase in 2015. And comparable sales, or those at restaurants open at least a year, fell 1.6 percent to 1.7 percent, the company told investors last month in a preliminary summary of year-end performance.
Buffalo Wild Wings also disclosed that it spent about $6 million on the proxy battle and $4.6 million on consulting fees as executives studied ways to restructure the firm.
Smith, who became chief executive in 1996 and led the company from about 50 locations to more than 1,200, agreed to stay on through the sale.
Evan Ramstad 612-673-4241