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Investor hungry for more active role in DineEquity

WASHINGTON A large shareholder in DineEquity Inc., the parent to Applebee’s and IHOP, filed forms with the Securities and Exchange Commission on Friday to take a more active role in the restaurant company.

Shares of DineEquity rose more than 30 percent to close Friday at $15.70.

The Memphis, Tenn.-based Southeastern Asset Management Inc. said in its forms that it converted its ownership filing status from the benign 13G, which is required of all shareholders that own more than 5 percent of a company, to a 13D, which typically denotes a more active investor stance.

With its 18.4-percent stake in DineEquity, Southeastern said it already has talked with DineEquity's management, "and will have additional conversations with management or third parties regarding opportunities to maximize the value of the company for all shareholders."

DineEquity, which has seen its stock price fall nearly 64 percent this year, has been saddled with the turnaround of casual-dining chain Applebee's, which it acquired in late 2007 in a deal valued at about $2 billion. The company still holds a large amount of debt from the transaction, which helped widen its latest-quarter loss. The company posted a net loss of $16.4 million, or 98 cents per share, for the quarter ended Sept. 30, versus a year-ago loss of $11.6 million, or 69 cents per share. Its latest-quarter revenue increased to $391.2 million from $91.4 million a year ago, which was prior to the Applebee's acquisition.

In a statement to Nation's Restaurant News on Friday, DineEquity said that the company “maintains an active dialogue with our investors and welcomes their views and ideas.”

"We carefully consider and, where deemed appropriate, act on investor suggestions and comments," the statement continued. "We remain focused on revitalizing and restructuring the Applebee's business as well as continuing IHOP's momentum, and we will continue to evaluate all avenues for creating long-term value that are in the best interest of our shareholders."

DineEquity operates or franchises 3,400 restaurants under its two brands.

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