Friendly Ice Cream Corp. Wednesday evening announced it intends to expand its board of directors from five members to seven. The board “is considering a number of highly qualified individuals with experience in the hospitality industry, who they believe can bring substantial value to the Company,” Friendly’s said in its statement.
The company said the board had decided to offer one of the two new seats to a designee of the group of shareholders led by Sardar Biglari; the additional seat would give Biglari representation approximately proportional to his group’s ownership in the company.
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In addition, Friendly’s said, the board determined it would be in the best interests of the shareholders to make this offer, to avoid a potentially contentious and expensive proxy fight at a time when the company is actively pursuing key initiatives to improve shareholder value.
“Friendly’s is firmly committed to serving the interests of all our shareholders, and further distractions to our management team and employees will not serve those interests,” said Donald N. Smith, chairman of the board.
“We believe adding highly qualified individuals to our Board of Directors with experience in the hospitality industry will assist us in further pursuing and developing our key strategic initiatives and is in the best interests of the Company,” he added.
“We also believe that it is important to listen to our shareholders. Mr. Biglari, together with his group, control approximately 14.9 percent of the Company’s outstanding shares, and we are open to their participation on our Board proportional to their ownership.”
Wilbraham, Mass.-based Friendly Ice Cream Corp. (AMEX: FRN) is a vertically integrated restaurant company, with more than 520 company and franchised restaurants throughout the Northeast, and a maker of Friendly’s ice cream that is distributed to more than 4,500 retail locations. The 71-year-old company is currently remodeling its restaurants and its product line. Additional information is available at www.friendlys.com.
