Cracker Barrel’s Top Investor Considers Bid for Company

Cracker Barrel’s largest shareholder urged its board on Tuesday to consider selling the company â€" to him.

In a letter to the board, Sardar Biglari, an activist investor who owns nearly 20 percent of Cracker Barrel Old Country Store Inc. through his investment firm, the Biglari Capital Corporation, said it would take an “entrepreneurial mind” to improve the company’s earnings, which he called “far too low in your hands.”

Mr. Biglari urged the company to consider “all potential extraordinary transactions” to improve shareholder value, including selling the restaurant chain to the highest bidder. If the board did not “promptly” announce a sale process, Mr. Biglari said in a separate Securities and Exchange Commission filing, he would call a special shareholders’ meeting to vote on such a deal.

But Mr. Biglari, whose previous attempts to gain a seat on Cracker Barrel’s board have failed, doesn’t just want the board to sell him the company, which is based in Tennessee. He also wants it to help him amend Tennessee law, which he says restricts such a deal.

Representatives for Cracker Barrel and the Biglari Capital Corporation could not be reached for comment.

Mr. Biglari also suggested that the board begin a share repurchase program, but said he would consider selling his stake in the company if it did so since he would “not want to leave our money in your care.”

Cracker Barrel temporarily withdrew products relating to A&E’s “Duck Dynasty” reality series after one of the show’s stars made inflammatory comments about gay people, a move Mr. Biglari pointed to as evidence of poor management.

Tuesday’s letter is the latest act in a long-running drama involving Mr. Biglari and Cracker Barrel. The company in the past has instituted poison pill provisions to prevent a takeover by Mr. Biglari.

This post has been revised to reflect the following correction:

Correction: December 24, 2013

An earlier version of this post did not attribute Sardar Biglari's statement about a special shareholders' meeting to an S.E.C. filing that is separate from the letter to the board.