This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Activists Fill Pantry with Full Proxy Slate


Eberwein said he believes that reducing the company's debt load would improve its valuation, but he's not dead set on one strategy. "There are lots of ways to do it," he said, adding that a REIT deal would be one way to raise money for debt repayment.

Although multiple existing REITs have contacted him about sale-leaseback deals, including one REIT with a market cap in the $4 billion range, Eberwein wondered whether Pantry would get the most value from going solo.

"If we have four or five REITs calling us up and saying please, please, please do a deal with us - they're not running a charity," he said, adding, "This is the option I'm most intrigued by: creating our own REIT."

Pantry could create a REIT containing some of its real estate through sale-leasebacks, and monetize that entity through an initial public offering. One example of a similar convenience store REIT model is Getty Realty  (GTY).

During the activist road show, some investors questioned whether Pantry was big enough do its own REIT and wondered how much work it would take to renegotiate real estate contracts.

Eberwein acknowledged that it would be a lot of work to determine whether Pantry has the size and diversification to create a REIT, to decide which locations it would want to include and to renegotiate contracts, but he also said he thought those questions were worth asking.

Another option would be creating an MLP for Pantry's fuel servicing assets, as convenience store operator Susser Holding Corp. has done.

Lone Star and JCP took legal advice on the proxy fight from Steve Wolosky of Olshan Frome Wolosky. Pantry was advised by Smith, Anderson, Blount, Dorsett, Mitchell & Jernigan.

Pantry did not respond to requests for comment. JCP Investment could not be reached for comment.

3 of 4

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
PTRY $36.74 0.00%
SUSS $81.72 -0.32%
CASY $87.19 0.00%
AAPL $130.28 0.00%
FB $79.19 0.00%

Markets

DOW 18,010.68 -115.44 -0.64%
S&P 500 2,107.39 -13.40 -0.63%
NASDAQ 5,070.0260 -27.95 -0.55%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs