Buffalo Wild Wings Inc. on Monday ratcheted up a disagreement with its largest shareholder in an unusual way — by agreeing about something.
Or someone, actually.
The Golden Valley-based company proposed two new candidates for its board of directors, including one offered earlier by the activist shareholder that has been pushing for big changes since taking a stake in Buffalo Wild Wings last summer.
The shareholder, Marcato Capital Management, accused the company in a statement of "desperate actions," saying it wasn't consulted and that "these changes do not go far enough." Marcato didn't say whether it would continue to support the candidate, Sam Rovit, chief executive of CTI Foods, an Idaho-based food processor and wholesaler.
In a statement, Andre Fernandez, who leads the governance committee on the Buffalo Wild Wings board, acknowledged that Rovit was first nominated by Marcato.
"As always, we are open to qualified candidates, and as part of our rigorous review, we held numerous discussions with Sam and determined that his nomination for election was in the best interests of the company and all shareholders," Fernandez said in the statement.
Rovit formerly was a top executive at Kraft Foods and meatpacker Swift & Co. He did not return a call for comment.
Buffalo Wild Wings' board, executives and franchisees will face off before shareholders with Marcato principal Mick McGuire at the company's annual meeting. The company usually has the meeting in May but hasn't announced a specific date.
McGuire last month proposed a slate of four candidates, including himself and Rovit, to the nine-person board of directors. In statements and on a specially created website, McGuire has tried to persuade franchisees and shareholders that Buffalo Wild Wings ought to unleash value he believes is trapped in real estate associated with its company-owned stores.
The nearly 1,200 units in the Buffalo Wild Wings restaurant chain are about evenly split between franchisees and the company. McGuire has urged the company to sell 90 percent of the restaurants it owns to franchisees. The company in early February announced it would sell 10 percent, or about 50 to 60 restaurants, in a test of McGuire's ideas. Executives said then that a rapid transformation on a scale McGuire is seeking was unlikely to reap the value he suggests.
The pressure on the company has emerged at a time when executives are coping with a leveling off of the hypergrowth that made Buffalo Wild Wings one of the strongest-performing investments in the country over the past decade. It continues to seek new locations for its all-ages restaurant concept that revolves around wings, sandwiches and sports.
Since taking the stake, Marcato pressed the company to reshape its board with people who have more food industry experience. Buffalo Wild Wings responded with some immediate changes to the board last fall. A handful of senior executives also departed.
In addition to Rovit, Buffalo Wild Wings on Monday also nominated to its board Janice Fields, a 35-year food industry executive who was president of the U.S. unit of McDonald's Corp. from 2010 to 2012.
If elected, Rovit and Fields will take board slots being vacated by James Damian, a former executive at Best Buy Co., and Michael Johnson, an energy industry executive. Both are retiring from the board after serving on it since 2006. Damian served a term as board chairman.
Shares in Buffalo Wild Wings fell 2 percent on Monday, to $145.25
Evan Ramstad • 612-673-4241
