Txvestor

I for one am happy to get the hell out of this one. The management of this company has been abysmal to say the least, this has become apparent especially this past year, the risk management has been poor, over-concentration in solar assets in one state set them up for the ERCOT disaster, the leverage added to the woes, the external manager managed to maximize fees and not for shareholder value addition. So the market price started to reflect the abysmal management and so the opportunist struck. They had capital, wanted a framework to deploy it and found one selling for 50c on the dollar and were able to negotiate a take out for 80c on the dollar. To me that is not a great price but unless an activist is willing to take this on and throw out the current management on shareholders behalf, this is as good as can be had. Luckily for me, I entered at 28, I then averaged down at 22 and was agonizing at 16, so I got to exit with a small profit.

I am a little concerned that they reported only 83M of losses related to the pandemic. Whereas MKL reported 325M in business interruption etc. I am wondering how well they are reserving. Their investment returns have been abysmal for this entire cycle everything from hedges to wrong stock picks to poor long term holdings here. So by now we have a balance sheet that is the most leveraged it been in a long time and I am not sure how well prepared they are for a big hit.

Anyone have an idea what level of exposure each of these insurers like MKL, Allegheny and Fairfax have to business I nterruption? Buffett seemed to suggest one of their smaller competitors might be on the hook. I know MKL took a 325M guesstimate of damages, I think Fairfax said 83M and of course Allegheny is get to report but all of heir stocks sold off more than the market and I am wondering if markets pricing in exposire into this risk.

Ah yes but you won’t understand because you aren’t an entrepreneur. What a phony and fraud and shame on the investors who willfully turned over control to him.

I doubt any PE investor would bid. Its been a neglected brand for a long time and I don’t think they come back especially with the plethora of emerging eating concepts out there. If Sardar concludes the same thing, considering the language he is reported to have used about the debt not being at the holdco. level, He may try to fleece it of any valuables, esp. for his personal rather than BH gain. Who knows if this milk shake machine is such a ploy. Bond holders should be very worried. They have every right to be with Sardar at the helm.

Wonder where are all the buybacks. The stock is languishing barely above TBV and I guess we will be hearing more in the next Q but I am not sensing that there is much activity. For all the talk of Singleton etc. Actions are proving increasingly worrisome here.

Under 30 today. Delayed 10-Q.

If he was taking $20M compensation for shifty performance and buying up beaten stock for a low price, and recycling each year, eventually he will own the company outright. He has many options to transfer the economic interests to himself. He can pay himself, make money on the hedge fund, take generous corporate perks and have lavish idiot pet projects etc. bottom line he don’t consider shareholders partners, he considers them his chumps. anyone who thinks otherwise is crazy. but i don't think anyone thinks otherwise. i think they think at some price it's worth the risk because he will try to get the stock back to NAV for reputation. good luck with that ever happening. Sometime last year NBL asked a question on this forum, is there any price at which you will buy BH common stock. I thought about it and said to myself, well maybe at under $100, one can think about it. Having seen the shenenigans, the freefall at Steak-n-shake, ongoing idiot pet projects and the number of levers of transfer of economic interest he has. I can only think anyone betting in BH is betting on divine intervention for potential salvage.

If he was taking $20M compensation for shifty performance and buying up beaten stock for a low price, and recycling each year, eventually he will own the company outright. He has many options to transfer the economic interests to himself. He can pay himself, make money on the hedge fund, take generous corporate perks and have lavish idiot pet projects etc. bottom line he don’t consider shareholders partners, he considers them his chumps.

Why would he like to issue stock at “50% discount”? Well to enlarge the pie he can eat from! Thats why it is caveat emptor.

Lol. Couldn’t have happened to a nicer guy. ?

Just another nail in the coffin. Only the deluded fool SB will talk about 2 yr turnaround with milkshake machines invented by him. Total con artist. Chapter and verse of the intelligent investor huh. What a pathetic excuse for a human.

Just to be clear, I think it is more like 100 closures now, but most of them are not in Indianapolis. A few of them are, but the closures have been in many markets. I think Steak n Shake may have been on borrowed time even a few years ago - it seemed okay coming out of the recession - but according to franchisees it was always a fragile demand. I do think the one smart thing he did though is take out debt not backed by the company. He upstreamed cash, from that debt, and invested it - after a series of investments - putting it into Cracker Barrel. That is now the only channel with value. So if he hadn't done that - he would just be left with Steak n Shake's real estate. Instead, the real estate will be the creditors - but he has all of that other value outside of it. For his own enrichment, that was probably the right call. I know, I know, all the enrichment has gone to him and not shareholders - but I'm just saying he is better off having taken the debt on, upstreaming it and investing it - than he would have been not doing that. Some will say, he is taking advantage of the lenders - and maybe to a certain extent that is true. But on some level, that is what they were signing off on/underwriting - the credit risk related to Steak n Shake's business - and the deterioration of Steak n Shake is what is causing them heartburn - but that is the exact thing they were making a judgment on (along with the value of the real estate). Additionally, Steak n Shake is definitely going under - but the lenders already have perfected security interests in the company's real estate - so I do not believe they will be out most of the $180 million. If he wanted to upstream money and always knew it was a marginal brand he could and should have sold it when he instead saddled it with debt. He wanted to try out the upside through franchising while protecting the downside by taking advantage of those buying the bonds. You could argue its buyer beware, but in all sincerity, its more like anyone dealing with this character in any way beware! I wonder how the guy that sold his trucking insurance company feels right about now. I think he atleast got cash for his company. If there is any good that comes out of this character, it will be eventually exposing all the loopholes for self enrichment from shareholders out into the open.

The fact that some people think this is undervalued is what is ridiculous. This is uninvestable at almost any price due to SB. Those who were betting on the jockey, are looking pretty silly right now. Divine intervention that checks him out of this world will be a great value add right now, the odds of that are low at age 41. Value destruction and corporate malfeasance will continue apace, and shareholders will continue to be treated with contempt. I can't see anyone in their right mind, either accept BH shares in an acquistion or sell their lifes work to this guy. He can't even succeed as an activist since noone will trust him, how can anyone endorse him in a proxy battle ever again? So he is resorting to big ideas like Biglari Cafe, Milkshake machines, and cherry eliminations. So he has rendered himself pretty useless. In many ways he is the anti-Buffett.

To me that is a high likelihood event ie. SnS bankruptcy. He effectively was hinting at that possibility when boasting about not having the debt at the holdco level. He saddled it with debt to insure against that possibility and duped bondholders. I’d frankly be very worried if I was a SnS bondholder. He also has no other intent than to live his exorbitant lifestyle courtesy his shareholders and pay himself grotesquely(he is being generous to you all remember). If shareholders make money past that hurdle so be it(he may even be deluding himself that they could). But frankly as long as the first 2 criteria are met, the hell with the rest of it. I am stunned that his board is not considering their legal risk here and I am not sure how he is getting away. I think one reason however is complicit shareholders.