Panera Bread To Borrow $500 Million For Buyback, Held Talks With Activist
Panera Bread Co (NASDAQ: PNRA) authorized $500 million in new debt to buy back shares Wednesday and said it has "recently engaged in constructive dialogue" with activist hedge fund Luxor Capital Group L.P.
Panera gained 11 percent in late trading to $182.54. The shares are off about 6 percent year-to-date.
The St. Louis-based chain also said it agreed to sell and refranchise 73 cafes and is on track to reach its previously announced refranchising goal for 2015 of up to 150 stores.
Panera increased its buyback authorization to $750 million, to be financed with $500 million in new debt as well as with cash on hand and cash flow from operations.
Luxor's Christian Leone said in a statement that he supports Panera's actions and backs the company's management.
Panera has a dual-class shareholder structure with 1.4 million Class B shares mostly held by Chief Executive Ronald M. Shaich.
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