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HOTR - Chanticleer Holdings


Parsad

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Redesign of the restaurants:

 

http://www.huffingtonpost.com/2013/01/18/hooters-redesign_n_2503130.html?utm_hp_ref=email_share#slide=1999851

 

Also, an update by head office...nice to see that they are improving efficiency and margins.  That burn rate every quarter is a killer, so they need to get profitable fast.

 

http://finance.yahoo.com/news/chanticleer-holdings-provides-corporate-134500949.html

 

Cheers!

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Hooter's Is Chasing Women - As Customers:

 

http://www.cnbc.com/id/100536902

 

Cheers!

 

You guys catch Saturday Night Live Weekend Update yesterday?  "Hooters trying to attract women with salad is like trying to get women into your sex dungeon by playing Adele in the background". Ouch.

 

Yeah, I thought that was funny. 

 

I agree, I don't think they need to do anything specific to attract women.  Women go to nightclubs, they go to strip clubs...I think women don't go to Hooters because the food was shit and the restaurants looked like the inside of run down shacks.  I don't go to Hooters because the food is so bad.  If they improve the restaurants and improve the food, they will attract more customers...men and women. 

 

There are restaurants in Vancouver where the hostesses wear far more revealing and tighter dresses than the outfits at Hooters...and they are packed with women customers, because the atmosphere is stylish and the food is terrific.  Cheers!

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...I think women don't go to Hooters because the food was shit and the restaurants looked like the inside of run down shacks.  I don't go to Hooters because the food is so bad.  If they improve the restaurants and improve the food, they will attract more customers...men and women. 

 

There are restaurants in Vancouver where the hostesses wear far more revealing and tighter dresses than the outfits at Hooters...and they are packed with women customers, because the atmosphere is stylish and the food is terrific.

 

Sanjeev,

 

I could not find a good reason to invest in HOTR. You have not talked about reasoning behind investment in HOTR, what is holding you back?

 

The way I feel is that a patron can get exactly what they get at hooters (scantily-dressed women and hot wings) at just about any bar these days but without the "skeevy" factor.

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...I think women don't go to Hooters because the food was shit and the restaurants looked like the inside of run down shacks.  I don't go to Hooters because the food is so bad.  If they improve the restaurants and improve the food, they will attract more customers...men and women. 

 

There are restaurants in Vancouver where the hostesses wear far more revealing and tighter dresses than the outfits at Hooters...and they are packed with women customers, because the atmosphere is stylish and the food is terrific.

 

Sanjeev,

 

I could not find a good reason to invest in HOTR. You have not talked about reasoning behind investment in HOTR, what is holding you back?

 

Sanjeev -- do you know the guys at Chanticleer?  Is that part of your rationale -- since they are basically value portfolio managers who get capital allocation?

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...I think women don't go to Hooters because the food was shit and the restaurants looked like the inside of run down shacks.  I don't go to Hooters because the food is so bad.  If they improve the restaurants and improve the food, they will attract more customers...men and women. 

 

There are restaurants in Vancouver where the hostesses wear far more revealing and tighter dresses than the outfits at Hooters...and they are packed with women customers, because the atmosphere is stylish and the food is terrific.

 

Sanjeev,

 

I could not find a good reason to invest in HOTR. You have not talked about reasoning behind investment in HOTR, what is holding you back?

 

Sanjeev -- do you know the guys at Chanticleer?  Is that part of your rationale -- since they are basically value portfolio managers who get capital allocation?

 

Partly...and partly because somehow Mike Pruitt wheels and deals his way to get things to happen.  I don't always agree with what happens at Chanticleer...high burn-rate of capital on a quarterly basis, abandoning the fund management side a bit to focus on the restaurants, audit committee failure regarding the fraud, hiring an IR firm, etc.  But somehow Mike keeps things afloat when most other people would have hit a wall and collapsed.  You can't teach that! 

 

If the credit crisis did not happen, Chanticleer would have closed that initial deal with Texas Wings and Hooters Inc and we would not be having this conversation.  Instead, they lost time, burned through the cash they had, Mike had to support the business himself, and then he finally wheeled and dealed his way to closing the entire consolidation of the Hooters brand, while getting the right to expand the brand internationally. 

 

It is a bet for me on the people there, not on the business itself, margin of safety or anything else.  It's solely on the people.  I don't usually do that, but we've been with them a long time.  We have not added to the stock recently, but would if it went below book.  We're just going to go for a ride on this one, and see where it take us.  Cheers! 

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Hmmm...some good news I think:

 

http://www.sec.gov/Archives/edgar/data/1106838/000114420413016995/v339035_8k.htm

 

Looks like Chanticleer is exiting the investment business directly, and Joe and Matt will focus on a new investment vehicle.  I'll wait to see what the structure exactly looks like, but it's good for Mike to focus on the restaurant business, while Matt and Joe focus on the investment vehicle.  I suspect Chanticleer will have some sort of arrangement with the newco as a majority shareholder, but we'll have to see.  Cheers!

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Parsad - this an interesting one!  I could be wrong but it looks like they are emphasizing franchising and management, and offloading some of the early ownership burden onto the LPs.  I'm wondering how they carry their 3.1% interest in HOA.  So long as HOA is worth more than $200M, that interest alone is worth their current market cap.  And with 400+ locations it seems likely.

 

A concern is that they are positive about raising more equity to pay off debt in the near future, so share dilution seems inevitable.

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Parsad - this an interesting one!  I could be wrong but it looks like they are emphasizing franchising and management, and offloading some of the early ownership burden onto the LPs.  I'm wondering how they carry their 3.1% interest in HOA.  So long as HOA is worth more than $200M, that interest alone is worth their current market cap.  And with 400+ locations it seems likely.

 

A concern is that they are positive about raising more equity to pay off debt in the near future, so share dilution seems inevitable.

 

Also, I was disappointed to read that they will only have a minority stake in the new investment entity that Matt and Joe will be running.  One of the biggest reasons I originally invested in Chanticleer is because they were involved in the money management business, and I thought Matt and Joe were two terrific small/micro-cap analysts. 

 

I'm also dumbfounded how Chanticleer Advisors was costing $50,000 a quarter to Chanticleer Holdings?  The total expenses for our fund last year were about $12,500, and we manage more than Advisors, so how the hell did it cost Holdings about $200K?  Cheers! 

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I like his analogy of restaurants being the top of the "economic food chain".

 

 

"Looking For The Next Buffalo Wild Wings? Try Hooters"

 

"HOTR is just $11M. Losses could be total if Brazil fails in 2016. But in terms of the risks of these two stocks, unconventional wisdom says that BWLD at this point in time is even riskier than HOTR for the reasons outlined above. That, and the potential gains, if Chanticleer gets its act together and decentralizes by 2016, are much larger than BWLD's 756% from IPO to date."

 

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HOTR is diversifying, buying a burger chain.

 

"Chanticleer Holdings Announces Signing a Non-Binding Letter of Intent to Acquire American Roadside Burgers

 

CHARLOTTE, NC -- (Marketwired) -- 08/14/13 -- Chanticleer Holdings, Inc. (NASDAQ: HOTR) ("Chanticleer Holdings" or the "Company"), headquartered in Charlotte, N.C., announced today that the Company has signed a non-binding Letter Of Intent to purchase all of the outstanding shares of American Roadside Burgers, Inc. ("ARB"), a Charlotte, N.C.-based chain of 5 restaurants..."

 

http://ir.stockpr.com/chanticleerholdings/company-news/detail/574

 

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http://www.charlotteobserver.com/2013/08/14/4236763/charlotte-operator-of-hooters.html

 

I have been to American Roadside Burgers multiple times as it was within walking distance of my condo. I thought it was good, high-quality, fast casual burger joint. I am not a big burger guy so i usually went with a chicken sandwich. This particular location had a big lunch crowd and was slow at night. Many times I would be the only person in there if I went on the weekend when nothing was going on in uptown Charlotte.

 

Seems like a great win to have Lewison join the board. Bojanges was one of my favorite places in my younger days..now my system can't handle the spicy fried food that is so good from Bojangles : )

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http://www.charlotteobserver.com/2013/08/30/4276226/chanticleer-looks-to-grow-globally.html

update on Chanticleer and brief interview with Mike Pruitt.

 

From ^^ that article:

 

Q: What’s the next big thing for Chanticleer?

 

Our lead banker … when I asked him, “What would you do if you were me?” his response was, “You’re building some pretty impressive people and teams in these international markets. You could position Chanticleer to be the first call made by successful U.S. brands who want to expand internationally.”

 

Q: And are you thinking about doing that?

 

I haven’t done anything to promote that, but I can tell you there’s a burger chain in this country, that’s iconic, that’s already approached me. I’ve had another significant company, a juice company, approach me. So I’m already being approached by concepts.

 

And today they are raising more cash: 

 

Chanticleer Holdings Announces $1.6 Million Equity Financing

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