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2011 Biglari Holdings Annual Meeting


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Couple things from today's meeting

 

1. mustang capital is no longer part of BH

2. New format for SNS with counter service only is being pushed to compete with Five Guys and others

much cheaper to develop and smallernfootprint

3. Dual class structure is to increase flexibility for acquisitions and financing transactions, the 1 for 15 is off

the table

4.they recently hired 5 salespeople to get new franchisees

5. No comment on Freemont

6.Lion Fund has averaged 20% over last 10 years but would not discuss holdings or strategy

7. Called CCA corporate looting and paying for failure

8. breakfast is going well three weeks in

9. ITEX, sardar spoke with Steve white yesterday and told him he needs to have a shareholder vote or he would not support him in a transaction it's recently announced

 

 

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I have a couple of more points on the meeting: 

 

Direct causality between value and customer traffic; will continue reduce costs and pass added value to customer; cost of average check at S&S has gone from $7.40 to $6.40

 

Typical company owned unit produces $300,000 in CF; 6 Franchise units produce same CF with lower capital requirement

 

Prepared to open overseas; searching for the right partner

 

Gift Cards has turned out to be a great business; currently $7mil annually with $4mil in float

 

Sadar currently personally owns about 5500 shares

 

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I'm pretty sure I know what happened, but did he elaborate on why Mustang Capital is no longer part of BH?  Where is John Linnartz...is he still there?  I'm guessing not, since I remember doing an interview with John a couple of years back, and he was very much a straight shooter.  Cheers!

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No real explanation as to why Mustang is gone other than the fact that it was no real advantage for them to be part of a larger organization. Did not mention Linnartz specifically but the implication was that general partner will remain with Mustang. Originally, if I remember correctly, John Linnartz teamed up with Biglari partly out of a concern that if got "hit by a bus" the money in the fund, including his family's money, would be taken care of with Biglari. I guess that might have changed.

 

When questioned about the Lion Fund and growing the AUM there, Biglari said that it would have to be the right partners and the requirement would be $5mil and a 5 year lockup. Overall he said he liked the asset management business but my impression was that he seemed to downplay its role in BH going forward.

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I'm pretty sure I know what happened, but did he elaborate on why Mustang Capital is no longer part of BH?  Where is John Linnartz...is he still there?  I'm guessing not, since I remember doing an interview with John a couple of years back, and he was very much a straight shooter.  Cheers!

[/quote

 

Sardar mentioned compliance issues were problematic with having Mustang Capital

under the BH umbrella. Like Sanjeev, you can pretty much figure out

why they left BH

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