April 24, 2014 Okapi Mentioned in The New York Post
The water is getting hotter for the parent of Red Lobster.
An activist hedge fund has secured votes from 54 percent of Darden Restaurants’ shareholders to hold a special meeting to block plans to spin off Red Lobster into a separate company, sources said.
Starboard Value LP, the New York-based fund spearheading the campaign against the Red Lobster spinoff, argues that Darden, which also owns chains like Olive Garden and Capital Grille, should instead spin off its real-estate holdings.
Starboard, which owns 5.5 percent of Darden shares, has secured votes from “some of the largest institutions that own Darden” stock, said a source close to the situation.
“So is Mr. Otis, in a hot seat?” Starboard CEO Jeffrey Smith said in a CNBC interview Tuesday, referring to Darden CEO Clarence Otis, Jr. “I think he is in a hot seat.”
A Darden spokesman said the company hasn’t yet been notified of the results of the vote, which Starboard organized with the help of proxy solicitor Okapi Partners.
Even if Starboard wins the special meeting, it could end up waiting a while. That’s because Darden, which is incorporated in Florida, is allowed under the state’s laws to wait 60 days to set a date for the meeting and another 60 days to hold it.
Activist hedge fund socks Red Lobster spinoff [New York Post]