Biglari Seeks Acquisition of El Pollo Loco, Evaluations Underway

Sardar Biglari, through Biglari Capital, has made an unsolicited offer to acquire all outstanding shares of El Pollo Loco that it does not already own, currently holding about 15% of the chain. El Pollo Loco's Board of Directors is evaluating the proposal with the help of independent financial and legal advisors and has entered into a confidentiality agreement with Biglari. The company reported a modest 0.5% growth in comparable sales, primarily driven by increased menu pricing, though it faced a decline in customer transactions. This is not the first encounter between Biglari and El Pollo Loco; in 2023, the board implemented a shareholder rights plan in response to Biglari's growing stake, aiming to protect against potential aggressive takeover attempts. Despite the current offer, there is no assurance that it will lead to a formal agreement or transaction, as the board has not established a timetable for its decision. The news has positively impacted El Pollo Loco's stock, which rose by 9% during after-hours trading following the announcement.