Is Biglari exiting Cracker Barrel?Is Biglari exiting Cracker Barrel?

Jonathan Maze

Sardar Biglari appears to be winding down his holdings in Cracker Barrel Old Country Store, Inc.

Biglari’s hedge fund, The Lion Fund, said in an SEC filing this morning that it will sell as many as 1.25 million shares of Cracker Barrel through J.P. Morgan Securities.

That represents nearly a third of the 4.7 million shares of Cracker Barrel held by Biglari and his various companies, including Biglari Holdings and another affiliated hedge fund, Biglari Capital.

Uncertain is whether this means that Biglari is putting an end to his nearly four-year-old pursuit of seats on the Cracker Barrel board, or other major changes. The San Antonio investor, whose Biglari Holdings owns Steak n Shake and Western Sizzlin, has made three failed attempts to gain seats on the Cracker Barrel board. He also failed to convince shareholders to push the company to pay a dividend, or put itself up for sale.

Cracker Barrel stock has been close to its all-time high this year after it rose more than 27 percent in 2014, one of the top performing stocks in the restaurant industry.

Indeed, since Biglari first started buying up shares in the highwayside family dining chain in 2011, the company’s stock has skyrocketed. Biglari Holdings bought those 4.7 million shares for $241 million.

The value of those shares at yesterday’s closing was $644.7 million.

If the 1.25 million shares put up for sale were sold at yesterday’s closing price, Biglari’s Lion Fund would get $170 million, while still controlling nearly 3.5 million worth of Cracker Barrel shares.

Biglari selling shares will likely have a big impact on Cracker Barrel’s share price. Word of the sale, in fact, sent shares down more than 5 percent today.