Bob Evans Farms Inc. rose the most in three months after pursuing a transaction to squeeze money out of its real estate, a move spurred by activist-investor pressure.
The deal, which involves the company’s restaurant properties, may be either a sale-leaseback or a conversion to a tax-free real estate investment trust, Bob Evans said in a statement on Thursday. The assessment of the deal is slated to be completed in the next several months.
Investors have called on the chain to sell or spin off some of its real estate. Last year, Sandell Asset Management Corp. won seats on the company’s board after a proxy fight where the firm pushed Bob Evans to better capitalize on its assets. In March, the company said it had hired JPMorgan Chase & Co. to evaluate strategic options for its properties.
The shares climbed 2.9 percent to $47.44 in New York, the biggest one-day gain since March 5. The stock was down 9.9 percent this year through the close of trading on Thursday.
Bob Evans owned and operated 564 restaurants in 19 U.S. states as of Jan. 23. It also has a foods division, where it makes and sells refrigerated and frozen items such as pork sausage and breakfast sandwiches.
Even with a real estate transaction, the company would still like to be able to separate its foods and restaurants businesses “at some point in the future if advisable at that time,” Chief Financial Officer Mark Hood said in Thursday’s statement.
In May, the company said it planned to do a sale-leaseback for its corporate headquarters in New Albany, Ohio, as well as for two of its manufacturing facilities. The deal would indirectly fund share buybacks.