NEW YORK, NY – After seizing control of Darden Restaurants back in 2014, activist investor Starboard Value is now cutting back its stake in the company by about 11%.
According to the Wall Street Journal, the sell-off comes just as the restaurant owner saw a “significant appreciation” in Darden’s stock price. The publication reports that Darden’s shares have increased by approximately 16% in the past twelve months.
Starboard said in a regulatory filing that it intends to remain a large shareholder in Darden. The investor’s stake now stands at 10.3 million shares, or 8.1% of Darden’s outstanding stock, down from 11.6 million shares, or 9.1% of stock, as of a November 27 filing, according to the Wall Street Journal.
After Starboard had overturned Darden’s entire Board of Directors in October of 2014 and placed Starboard CEO Jeffrey Smith as the company’s Chairman, the restaurant operator seemed to completely turn around its poor financial performance in the year prior. In its most recent quarterly report, Darden beat Wall Street expectations and increased sales for the sixth consecutive quarter.
The increased performance is due, in part, to Darden’s progress in revamping its Olive Garden brand. As we previously reported, CEO Gene Lee said, “We continue to make progress on our operating fundamentals of culinary innovation, attentive service, and engaging atmospheres while continuing to focus on disciplined cost management. This progress is a direct result of our hard work and commitment to creating memorable guest experiences in our restaurants.”
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