Shares of Bob Evans Farms Inc were higher than any other time in the past three months following the announcement it was pursuing a deal to squeeze money from its real estate, which was spurred on by pressure from an activist investor.
The deal involves the properties where its restaurants are and may be either sale-leaseback or conversion to tax free real estate investment trust, the company said in a prepared statement Thursday.
The full assessment of the planned deal will be completed within the next several months. Investors have been calling on the restaurant chain either to sell or to spin off some real estate.
Last year board seats at Bob Evans were won by Sandell Asset Management Company after a proxy fight where the firm pushed Bob Evans to capitalize on assets better.
In March, the business said it hired JP Morgan Chase to evaluate its strategic options for its different properties.
The shares were up by 2.9% in Bob Evans the biggest gain in one day since March 5. This year through Thursday’s close of business, stock prices for the year were down 9.9% for Bob Evans.
The company owned as well as operated 564 restaurants across 19 states as of the end of January 2015. It has a foods division as well where it makes as well as sells frozen and refrigerated items like breakfast sandwiches and pork sausage.
Even with the real estate transaction, the company still wants to separate its restaurant and foods divisions, at some point if advisable, said Mark Hood the CFO.
Last month, Bob Evans said it was planning to perform a sale leaseback for its headquarters located in New Albany, Ohio. It was also going to do the same for two manufacturing facilities it has. The deal would help to fund share repurchases indirectly.