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Activist could push for big changes at Bloomin’ Brands

Activist could push for big changes at Bloomin’ Brands

Jana Partners floats exploring strategic alternatives, trimming Outback owners’ other brands

An activist investor could push Bloomin’ Brands Inc. to sell one or more of its four casual-dining concepts, according to a filing with the Securities and Exchange Commission this week.

On Tuesday, the Outback Steakhouse owner acknowledged a Monday filing by Jana Partners, which indicated ownership of nearly 8 million shares, or just shy of 9 percent of the company.

In a statement, the Tampa-based Bloomin’ said its directors and management “appreciate the views of its stockholders and will consider the perspectives reflected” in the filing.

According to the filing, Jana said it plans to talk with the company about various topics, “including a review of strategic alternatives, including exploring a sale” of the company.

The filing also suggested the activist would talk about “portfolio composition,” which would include the number of chains that Bloomin’ operates. The company operates Outback, Carrabba’s Italian Grill, Fleming’s Prime Steakhouse & Wine Bar and Bonefish Grill.

The company’s stock has spiked more than 16 percent since the filing.

Jana is a well-known activist that had targeted Whole Foods this year before Amazon Inc. bought the grocery chain. The investor group currently targeting Bloomin’ includes Neal Yanofsky, a consultant who has held leadership roles at both Panera Bread Co. and Dunkin’ Brands Inc.

Brian Vaccaro, analyst with Raymond James, noted that Bloomin’ no longer owns real estate and has a lot of debt, removing two potential moves that an activist could push.

Bloomin’ could also cut general and administrative spending. Or it could explore some sort of sale, either of the entire company, or it could mean a sale of one of the company’s four concepts outside of flagship Outback.

Bloomin’ has routinely come under some scrutiny from analysts who wonder whether the company should sell off one of its brands. CEO Liz Smith, however, has said the company has a “tightly edited portfolio of brands.”

Three of the company’s four concepts reported same-store sales declines in Bloomin’s most recent quarter — though Outback’s same-store sales increased 0.6 percent in the period ended Sept. 24.

And the company said all four of its brands reported a same-store sales increase in October.

Contact Jonathan Maze at [email protected]

Follow him on Twitter: @jonathanmaze

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