Shake Shack (NYSE:SHAK) gained early Monday after the Wall Street Journal reported that activist investor Engaged Capital is planning a proxy fight for three board seats at the company. Engaged Capital acquired a 6.6% stake including swaps.
Engaged, has been talking with management of the chain for the past six months, though has failed to reach an agreement, according to a WSJ report , which cited people familiar.
The activist fund, run by Glenn Welling, sent a letter to the Shake Shack board about its request for directors and other changes in March, the WSJ said. Engaged believes it has ways to double the hamburger chain's profitability within two years and wants the company to get rid of its staggered board.
Shake Shack, which has a market cap of $2.8 billion, reported Q1 results earlier this month.
The company recorded a 52-week high for its shares last week.
Shake Shack Inc. owns, operates, and licenses Shake Shack restaurants (Shacks) in the United States and internationally. Its Shacks offers hamburgers, hot dogs, chicken, crinkle cut fries, shakes, frozen custard, beer, wine, and other products. As of December 29, 2021, it operated 369 Shacks, including 218 domestic company-operated Shacks, 25 domestic licensed Shacks, and 126 international licensed Shacks. Shake Shack Inc. was founded in 2001 and is headquartered in New York.
SHAK shares $3.53, or 5.4%, to $68.74.
