Activist investor Sardar Biglari launched his eighth proxy battle at Cracker Barrel after the dining chain reported disappointing fourth-quarter earnings on Wednesday. In a filing on Thursday, Biglari, who is also the CEO of Steak n’ Shake, urged shareholders to vote against the re-election of Cracker Barrel CEO Julie Masino and railed against the chain’s management, which he deemed “worse than mediocre.”
Biglari’s latest campaign is part of a 14-year entanglement with Cracker Barrel in which he has repeatedly failed to get himself elected as a director. He has, however, managed to elect two candidates of his choosing (in 2022 and 2024), while fighting against his proxy battles has cost Cracker Barrel millions. Even this was cause for criticism from Biglari: “The Board has spent $31 million of shareholders’ money to prevent one of its largest shareholders [Biglari] from having a minority voice. Now the Company has become a laughingstock.”
For many years, Biglari was one of the company’s largest shareholders, at one point owning nearly 20% of Cracker Barrel’s shares. He has since sold off much of his stake, and disclosed ownership of a 2.9% stake in the proxy filing.
The restaurant chain’s fourth quarter earnings disclosed a miss on earnings per share, falling short on earnings per share while beating on revenue and projecting weaker customer traffic in the year ahead.
Cracker Barrel’s stock fell approximately 10% in after hours trading and was down more than 8% at time of publication.
Biglari, who is also the CEO of Biglari Holdings, which also controls Maxim magazine, isn’t going away. On Thursday, he urged shareholders to vote against the board’s directors, whom he accused of “severe destruction of shareholder value,” an inability to understand Cracker Barrel’s brand, and a failure to select a suitable CEO.
“Instead of demonstrating the discipline and stewardship required to protect and enhance a storied brand, management has relied on ill-conceived strategies that have worsened existing challenges rather than solved them, culminating in the disastrous “brand refresh” that has ranked among this century’s worst brand blunders alongside Bud Light and Jaguar,” he wrote. “CEO Julie Masino’s tenure has been marked by repeated and highly publicized missteps, from misguided rebranding efforts to ill-fated “transformation” initiatives, that reflect the Company’s troubling pattern of tone-deafness and disregard for shareholder capital.”
Biglari also took aim at the Cracker Barrel board’s marketing expert, Gilbert Dávila, whom he accused of being responsible for the chain’s struggles, and “eroding shareholder value” by approving “outsized pay packages” for Cracker Barrel executives.
“Shareholders can send a message that merit and performance, the foundation that built America, rank above DEI,” he continued.
Cracker Barrel has dismissed Biglari’s antics, previously telling Fortune that the activist investor has made “numerous false and misleading claims about Cracker Barrel, its Board and management.” Shareholders have rejected nearly all of his proposals.
In June, The Wall Street Journal reported that many Cracker Barrel customers were mourning the “loss of that old-timey feeling,” and the uproar escalated in August after a particular tweet by Donald Trump Jr., highlighting allegations that the rebrand was “woke.” The market reaction alone wiped out roughly $100 million from the chain’s value. At issue was, in part, the new logo that did away with the traditional “Uncle Herschel” mascot—a denim-clad old man perched on a chair beside a barrel.
The redesign, which was a key part of Cracker Barrel’s $700 million modernization campaign—and was intended to reverse an outflow of customers from the chain, performance that Biglari has criticized for years—immediately ignited controversy, drawing outrage from longtime diners, Biglari, and even President Trump. Biglari used his restaurant’s social media accounts to troll Cracker Barrel over the blunder.
Cracker Barrel quickly reversed course, ditching the rebranding and suspending its planned restaurant renovations. The company’s stock is down roughly 17% year-to-date.
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