BH - Biglari Holdings

[Jurgis]

So I guess... 'Hi Sardar'  ???

 

He only googles and answers to Mr. Big.  ;D

[ragu]

No reason given.

 

As a shareholder, I'm not complaining about the cancellation. Out of curiosity, when were you originally notified of the meeting?

 

Best,

Ragu

[OracleofCarolina]

Swenson files proxy, Biglari accumulates AirT (Swenson is Chairman/CEO), Swenson adopts shareholder rights plan???

 

http://www.marketwatch.com/story/air-t-inc-adopts-stockholder-rights-plan-with-stockholder-protections-2014-12-15?reflink=MW_news_stmp

 

If true (and who the hell knows), I hope it doesn't turn into a pissing contest.

 

Didn't realize Swenson and John Linnartz were working together on a different proxy fight.

 

http://www.marketwatch.com/story/mustang-capital-announces-proxy-contest-at-furmanite-corporation-2014-12-04

 

 

[Parsad]

Why?... Simply because it was false! Biglari has never been Western’s largest stockholder… Instead, his investors in the Lion Fund were! He behaved like a Buffett, a Malone, a Watsa, or a Marks, without really owning nor controlling his company… With the benefit on hindsight it was an obvious mistake! To really get to own a large portion and therefore to achieve control over BH, Biglari needed to be paid for his services and still needs to.

 

Gio, you are reinterpreting statements that were made when you were not even involved with the company.  I was there, as were a number of other investors, and you disregard our first-hand knowledge of the events...even discount them...so as to justify your reasons for ignoring behavior. 

 

Sardar would have been handsomely compensated over time.  All he had to do was continue to work hard, garner more loyalty and trust, and the world would have been his oyster!  Instead, he chose to renege, renegotiate, alienate and subjugate his loyal shareholder base.  Flip-flop, flip-flop, flip-flop...my way or the highway...yes like Buffett, no not like Buffett...we are not the company for you.  Cheers!

[giofranchi]

Gio, you are reinterpreting statements that were made when you were not even involved with the company.  I was there, as were a number of other investors, and you disregard our first-hand knowledge of the events...even discount them...so as to justify your reasons for ignoring behavior. 

 

Well, actually I have only quoted form a letter Biglari had written in 2007 and said the promise contained in that quote (at least as I can understand it today) had been a big mistake! A promise I would never have made to my investors… Nothing else! ;)

 

As I have said, I will try to examine every action Biglari takes and judge if I would do it or wouldn’t in his stead. In fact, though his organization is much larger than mine, I think the two have more than one feature in common! :)

 

Cheers,

 

Gio

 

[muscleman]

Guys who don't like rights offering should read these letters

http://www.cornerofberkshireandfairfax.ca/forum/general-discussion/the-western-sizzlin'-letters-(sardar-biglari)/

 

He did rights offering in 2006 and 2007 as well and no one seems to complain.

Now people started to hate him so anything he does can be a reason for hate.

 

Parsad, can you tell me how much does Parbrai charge in his Dhango holdings? I am interested to know.

[Parsad]

Guys who don't like rights offering should read these letters

http://www.cornerofberkshireandfairfax.ca/forum/general-discussion/the-western-sizzlin'-letters-(sardar-biglari)/

 

He did rights offering in 2006 and 2007 as well and no one seems to complain.

Now people started to hate him so anything he does can be a reason for hate.

 

Parsad, can you tell me how much does Parbrai charge in his Dhango holdings? I am interested to know.

 

$100K salary, and 10% of the outperformance of the S&P500 on a rolling five-year basis.  And he doesn't even control the company...go figure, eh Gio!  Cheers!

[TheValueDude]

new filings

http://www.sec.gov/Archives/edgar/data/1334430/000092189514002683/0000921895-14-002683-index.htm

http://www.sec.gov/Archives/edgar/data/353184/000092189514002680/xslF345X02/form307428037_12172014.xml

[TheValueDude]

So AirT and BH are 10% owners of Insignia.  BH is 10% owner of AirT. CEO of AirT is filing proxy against BH.

 

Somebody put on the popcorn, this could be entertaining.

[wescobrk]

So AirT and BH are 10% owners of Insignia.  BH is 10% owner of AirT. CEO of AirT is filing proxy against BH.

 

Somebody put on the popcorn, this could be entertaining.

 

I wouldn't bet on the guy that owns a whopping 3k shares of BH.

I hope this guy knows what he is doing (taking on Sardar).

[wescobrk]

So one of the nominees Nick Swenson wants to nominate for the board for BH bought 225 shares of BH stock for $363 on 08/27/14 and then a few more shares around $359 then sold all the shares he bought at a loss on October 20th for $330 a share.

We are suppose to have confidence in Seth Beckett? wtf?

[wescobrk]

So AirT and BH are 10% owners of Insignia.  BH is 10% owner of AirT. CEO of AirT is filing proxy against BH.

 

Somebody put on the popcorn, this could be entertaining.

 

It doesn't look like Nick is looking to shake things up too much with Insignia.

 

In connection with his appointment to the Company’s Board of Directors, Mr. Swenson has entered into an agreement with the Company whereby he, as well as Air T, Groveland Capital, LLC, Groveland Hedged Credit Fund, LLC and their respective affiliates, have agreed to vote their shares in favor of all of the Board’s director nominees at the 2015 annual meeting, which will include Mr. Swenson, the additional director expected to be elected during November 2014, and five other nominees, and abide by certain standstill provisions during Mr. Swenson’s time of service on the Board.

[abitofvalue]

If Sardar bought a bunch of shares of another company just because the CEO filed a proxy against him it shows a shocking disregard for shareholder funds.  He cannot be that thin skinned. 

[BTShine]

If Sardar bought a bunch of shares of another company just because the CEO filed a proxy against him it shows a shocking disregard for shareholder funds.  He cannot be that thin skinned.

 

I'm wondering if it could possibly be that simple too or whether there is some other more complicated situation going on here.

 

Insignia looks like a decent company and has a ton of cash on hand.  Cash on hand looks to be around $20 million, which is almost half the value of the company.  So, I don't think it's totally out of line for Biglari to be interested in the company, but it's definitely a curious situation that has transpired.

 

As for Air T, I've no clue if that company is attractive, or not. 

[jschembs]

If Sardar bought a bunch of shares of another company just because the CEO filed a proxy against him it shows a shocking disregard for shareholder funds.  He cannot be that thin skinned.

 

I'm wondering if it could possibly be that simple too or whether there is some other more complicated situation going on here.

 

Insignia looks like a decent company and has a ton of cash on hand.  Cash on hand looks to be around $20 million, which is almost half the value of the company.  So, I don't think it's totally out of line for Biglari to be interested in the company, but it's definitely a curious situation that has transpired.

 

As for Air T, I've no clue if that company is attractive, or not.

 

My perspective is Groveland has taken business owner's approach to both AIRT and ISIG, and built positions very slowly. Biglari, on the other hand, appears to have had a knee-jerk reaction to Groveland's 13D, aggressively buying both AIRT and ISIG with no regard to price. The chart of AIRT looks more like a penny stock, but when you realize it's just Biglari effectively bidding market orders for two weeks straight, it makes more sense.

[TheValueDude]

If Sardar bought a bunch of shares of another company just because the CEO filed a proxy against him it shows a shocking disregard for shareholder funds.  He cannot be that thin skinned.

 

"This is (my) concern Dude."

[giofranchi]

$100K salary, and 10% of the outperformance of the S&P500 on a rolling five-year basis.  And he doesn't even control the company...go figure, eh Gio!  Cheers!

 

Sanjeev,

Three things:

 

1) I don’t know Pabrai and I don’t know his new company… Therefore, I cannot judge and I won’t. In my experience control is very important in business. I have always invested with people who have full control over their companies. So far so good. I have full control over my company. So far so good. I don’t see the need to change my view about the relevance of control in business, just because Pabrai doesn’t control his company. Especially because I don’t know Pabrai’s situation in detail;

2) Even if you don’t have full control over your company, one thing is to own 20% of the company, another completely different thing is to own 2-3% of it. If you own 20% of your company, I agree your only thought should be to grow rich through the market price appreciation of its stock. Instead, when you own 2-3% of your company, you should follow a 2 steps strategy: first, you should get to own 20% of your company, second you should grow rich through the market price appreciation of its stock.

3) Now, you surely can do very well simply owning 2-3% of BH and relying on its stock price appreciation… No doubt about it! Yet, it wouldn’t take into consideration Biglari’s ambition… Ambition might differ from person to person. Maybe Biglari thinks of himself on the Forbes 400 list, and maybe Pabrai couldn’t care less… But I don’t judge ambition: imo if ambition is channeled the right way, it could lead to great results; if, instead, it is channeled the wrong way, it could lead to disaster.

 

In the end, therefore, it all comes down to the quality of business and investment decisions Biglari will make in the future: if they are good/great, BH will do very fine; if they are mediocre/poor, BH will surely suffer. As I have often said, I mean to keep watching them very closely, to judge them, and to act accordingly. ;)

 

Cheers,

 

Gio

 

[giofranchi]

Gio - do you do the same things that Biglari is doing to your partners? ( your parents and sister? )  ;D

 

I don’t know what you mean exactly, but rest assured they are paying me for my services! ;)

 

Gio

 

[Jurgis]

If Sardar bought a bunch of shares of another company just because the CEO filed a proxy against him it shows a shocking disregard for shareholder funds.  He cannot be that thin skinned.

 

I'll +1 on this. I think he might be that thin skinned. Or at least that egotistic to have a retaliatory response and bid up the shares of competitors companies regardless of the price. I also have a feeling that Groveland guys might have just baited him expecting something like this. And the bait worked.

 

I've said that this is a popcorn stock in the past. I might have to keep my position at popcorn levels, since I am not sure even the Mr. Big discount is enough for serious investment.

[BTShine]

If Sardar bought a bunch of shares of another company just because the CEO filed a proxy against him it shows a shocking disregard for shareholder funds.  He cannot be that thin skinned.

 

I'll +1 on this. I think he might be that thin skinned. Or at least that egotistic to have a retaliatory response and bid up the shares of competitors companies regardless of the price. I also have a feeling that Groveland guys might have just baited him expecting something like this. And the bait worked.

 

I've said that this is a popcorn stock in the past. I might have to keep my position at popcorn levels, since I am not sure even the Mr. Big discount is enough for serious investment.

 

What do you value BH at?  With or without the BH discount - use any figure you want - but I'm just curious what you're estimate of intrinsic value is?

 

Why are you willing to own a little if you're not willing to own a lot?  If not enough for a serious investment, then why invest in it at all?

 

Great questions, I'm curious as well

[Jurgis]

I owned very few shares for popcorn entertainment value for couple years. I bought a bit more recently on sum-of-parts undervaluation. Not much because I think that CBRL is overvalued. If I wanted to buy CBRL cheap, it would be over 30% down from here, so then BH is not undervalued anymore. However, as I said before, there's a swath of "fair value" for CBRL from current price to undervalued price, so there's also a swath of BH undervalued-to-non-undervalued.

 

With the current developments I might go to popcorn value again.

 

Regarding the "If not enough for a serious investment, then why invest in it at all", I am not concentrated investor like most (?) people on this board are. I hold ~60 positions. Some of them small, some of them bigger. I could expound on this more, but I don't think this is the place for it. :) If you really want to know, point to some relevant board and I'll answer there.

[TheValueDude]

errr.... what? :o

 

http://www.sec.gov/Archives/edgar/data/93859/000092189514002705/ex991to13da2307428036_121714.htm

 

stock purchase plan not 4 months after the rights offering?

[Parsad]

errr.... what? :o

 

http://www.sec.gov/Archives/edgar/data/93859/000092189514002705/ex991to13da2307428036_121714.htm

 

stock purchase plan not 4 months after the rights offering?

 

Looks like they are buying only up to 62,000 shares.  Cheers!

[abitofvalue]

errr.... what? :o

 

http://www.sec.gov/Archives/edgar/data/93859/000092189514002705/ex991to13da2307428036_121714.htm

 

stock purchase plan not 4 months after the rights offering?

 

Looks like they are buying only up to 62,000 shares.  Cheers!

 

so this is probably a silly question - but why is the lion fund buying stock instead of BH directly? Is it because Sardar wants to keep voting the stock? Seems odd to use corporate funds (routed through Lion Fund by way of BH's investment in Lion Fund) to essentially do a buyback.  Surely I am misunderstanding something here.

[muscleman]

errr.... what? :o

 

http://www.sec.gov/Archives/edgar/data/93859/000092189514002705/ex991to13da2307428036_121714.htm

 

stock purchase plan not 4 months after the rights offering?

 

Looks like they are buying only up to 62,000 shares.  Cheers!

 

Please let me know if I am wrong. I know that for share buybacks, it is only allowed to buy at most 10% of the past 30 day's average trading volume per day.

In BH's case, it is only 600 shares per day. 62000 shares means buying the maximum allowed per day for 108 days. There are only 260 trading days or so.