Activist investor group Pershing Square Capital Management LP took a 9.9 percent stake in Chipotle Mexican Grill Inc., according to filings with the Securities and Exchange Commission on Tuesday.
William Ackman, Pershing Square’s CEO, describes Chipotle in the filing as a strong brand with a differentiated offering, enormous growth opportunity and visionary leadership. But he also describes the stock as undervalued and an attractive investment.
Ackman indicates that the firm will engage with Chipotle’s management and board of directors about the composition of the board, the business, operations, cost structure, management and other issues.
Pershing Square is known in the restaurant industry as an activist investor who often pushes for significant change.
In 2005, for example, Ackman held a stake in McDonald’s Corp. and suggested the global fast-food chain consider a sale of real estate, though the investor has said in the past he’s not a fan of real-estate spinoffs.
Pershing Square was also a key player in Burger King’s return to the stock market in 2012. The firm in 2009 fought Tilman Fertitta’s buyout deal for Landry’s Restaurants Inc., though Pershing Square later relented once the price per share was increased.
And in 2008, Pershing Square successfully pushed for Wendy’s to spin off the Tim Horton’s sub brand. (LINK: