The move by activist investor Marcato Capital Management is the first salvo in a proxy fight.

MINNEAPOLIS – Activist investor Marcato Capital Management recently nominated four candidates to serve on the board of Buffalo Wild Wings Inc., continuing its push to shakeup the fast-casual restaurant chain.

Among the nominees is Mick McGuire, Marcato managing partner and founder. In addition to McGuire, Marcato’s nominees are:

  • Scott O. Bergren, former CEO of Pizza Hut US, a unit of Yum! Brands;
  • Sam Rovit, president and CEO of CTI Foods, a leading product development company specializing in foodservice applications; and
  • Emil Lee Sanders, formerly executive vice president and chief global development officer of TGI Fridays, and a former vice president at Buffalo Wild Wings.

McGuire has been a vocal critic of Buffalo Wild Wings’ growth strategy. “Buffalo Wild Wings enjoys a recognizable brand, distinctive consumer experience and substantial opportunity for continued system growth worldwide,” McGuire said in a statement announcing the board nominees. “Unfortunately, however, in recent years, critical business areas have underperformed — resulting in an erosion of shareholder value.”

Marcato Capital Management currently owns 5.2 percent of the outstanding common shares of Buffalo Wild Wings, which makes the hedge fund the fourth-largest shareholder. McGuire said essential changes are necessary at Buffalo Wild Wings, and those changes must begin at the board level.

“Buffalo Wild Wings' Board appears to display an alarming lack of relevant experience in the areas of restaurant operations, foodservice and supply chain innovation, franchise system management, corporate finance and capital markets,” he said. “Given these issues, coupled with the incumbent directors’ negligible economic interest, shareholders should ask themselves: how can the incumbent board provide the oversight and accountability that shareholders deserve?”

In response, Buffalo Wild Wings said in a statement the company will review the nomination notice. The company did not announce the date of the company’s annual shareholders’ meeting.

“The board takes its composition and refreshment very seriously, underscored by the appointment in October 2016 of three new, highly-qualified independent directors,” the company explained. “With the addition of our newly-appointed directors, the board comprises nine individuals, eight of whom are independent, that collectively bring meaningful leadership experience across multiple disciplines, including finance, restaurant industry, franchising, global supply chain management, hospitality, merchandising, media, marketing and consumer insights. We believe our board has the skills, qualities and perspectives to effective address the evolving needs of the company.”

The board members appointed in October 2016 are Andre Fernandez, president of CBS Radio, Hal Lawton, senior vice president of North America at e-Bay Inc. and Harmit Singh, executive vice president and CFO of Levi Strauss & Co.