Jack in the Box Stock Pops Amid Interest From Activist Investor

Jack in the Box shares are rising as investors digest an activist investor’s interest in the chain.

The burger restaurant’s stock was recently up 4%, after gaining 9% on Tuesday. The ascent comes as Jack in the Box (JACK) announced Biglari Capital Corp. has accumulated a nearly 10% stake in the company and intends to expand it.

Biglari Capital manages investments for Biglari Holdings Inc., the parent company of Steak N Shake and the Western Sizzlin restaurants, according to a company proxy statement. Sardar Biglari is the CEO of both firms, according to the statement. Other restaurant companies, such as Cracker Barrel (CBRL) and El Pollo Loco (LOCO), have wrangled with Biglari Capital in recent years, according to press releases.

Jack in the Box unveiled a stockholder rights plan on Wednesday. If Biglari Capital or another investor accumulates 12.5% or more of Jack in the Box shares, other investors will be able to buy stock at a discount, the company said. This could complicate any attempt by Biglari Capital or others to take over or hold sway over Jack in the Box.

“Jack in the Box’s Board is committed to protecting our stockholders and remains confident in management’s ability to execute the Company’s ‘JACK on Track’ plan,” Board Chairman David Goebel said in a statement. “The adoption of this Rights Plan is intended to provide the Company with adequate time to execute this plan and ensure stockholders are able to realize the full potential of their investment in the Company.”

The “JACK on Track” plan, announced in April, calls for closing underperforming restaurants, exploring the sale of Del Taco, and prioritizing debt repayment, a press release said.

Jack in the Box shares have fallen more than 50% so far this year.