Jack in the Box has implemented a temporary shareholder rights mechanism, poison pill, to limit the growing influence of activist investor Sardar Biglari.
The move follows a disclosure from Biglari Capital Corp., which revealed it now holds 9.9% of the company’s stock and intends to increase its stake. In response, Jack in the Box’s Board of Directors unanimously approved the poison pill strategy, effective immediately, to protect shareholder interests and preserve control of the company.
In a 2 July update, company VP Rachel Webb explained that if any investor crosses the 12.5% ownership threshold, all other shareholders would be allowed to buy additional stock at half price—excluding the triggering party. Those already above that threshold may retain their current holdings, but cannot acquire more without triggering the plan.
The company running 2,190 restaurants across 22 states, stated that the move is intended to protect investor interests and discourage any attempts to take control without offering a fair premium to all shareholders.
The company’s action arrives amid a broader pattern of aggressive acquisition tactics from Sardar Biglari, whose firm owns Steak n Shake and Western Sizzlin’. As reported by QSR Magazine and Chain Store Age, Biglari has made recent unsuccessful takeover bids for Cracker Barrel and El Pollo Loco.
As defined by Investopedia a poison pill is a tactic that lets existing investors purchase shares at a discount, diluting the holdings of any party attempting a hostile takeover.
David L. Goebel, independent chairman of Jack in the Box says, “The adoption of this Rights Plan is intended to provide the Company with adequate time to execute its strategy and ensure stockholders are able to realize the full potential of their investment.” He reaffirmed the board’s support for the “JACK on Track” plan, which aims to boost financial performance, enhance efficiency, and transition to an asset-light model.
The defense also follows a difficult quarter for Biglari Holdings. On 9 May, the firm reported a $33.3 million loss for Q1 2025, compared to a $22.6 million profit in the same period last year (Biglari Holdings 10-Q).
With this poison pill now in place, Jack in the Box has drawn a clear line to prevent what it views as a hostile takeover attempt and reaffirmed its intention to pursue its long-term growth independently.
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