9/26/2025

Six Flags Under Activist Pressure to Sell Real Estate

Wall Street Journal (09/26/25) Thomas, Lauren

Land & Buildings Investment Management plans to pressure Six Flags Entertainment (FUN) to spin out or sell its real estate and make other changes that could boost the theme-park operator’s stock price, according to people familiar with the matter. Land & Buildings has about a 2% stake in Six Flags, the people said. The company had a market value of about $2.1 billion as of Thursday, when shares dropped to a 52-week low. Six Flags shares have tanked more than 55% year to date as a host of problems, including bad weather, impeded the first half of the summer. That is a critical time for the company when visitors are more inclined to buy season passes to its 42 theme and water parks. Land & Buildings, led by the firm’s founder and chief investment officer Jonathan Litt, believes problems increased since Six Flags merged with Cedar Fair in July 2024, the people said. The deal was poorly received by investors and prompted record short interest in Six Flags. The investor plans to call again for Six Flags to spin out its parks real estate into a new real-estate investment trust entity that it thinks would trade at higher multiple. The idea of separating operations from real estate is sometimes referred to in the investing world as an “opco-propco” split. Land & Buildings also believes Six Flags should evaluate an outright sale of its real estate, which it thinks could be worth as much as $6 billion, the people said. It sees private-equity firms and other real-estate companies as interested buyers. Litt and Six Flags management have held friendly discussions about his ideas recently, people familiar with the matter said. The company has so far been focused on enhancing its core parks business. Land & Buildings first pushed Six Flags in late 2022 to monetize its real estate. Litt helped appoint a new board member at the time and proposed an opco-propco split. The company evaluated the idea but didn’t pursue it. In August 2023, Litt again publicly pushed for changes to its real-estate holdings. A few months later, Six Flags announced it was merging with Cedar Fair in a bid to create a regional, theme-park powerhouse. Litt publicly opposed the merger, saying he didn’t believe the plan was the best way to maximize value for shareholders. Today, he feels the deal has gone “far worse than we even anticipated,” the people familiar with the matter said. Though a bigger company, the combined entity must still compete with Disney and Universal parks, and other entertainment venues like Topgolf. Its sagging stock price has attracted other activists, in addition to Litt. In 2015, Litt urged MGM Resorts International to split into a separate REIT and hotel-management company. The Las Vegas casino giant eventually created a REIT for some of its properties. The REIT, MGM Growth Properties, was later sold.

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9/25/2025

Activist Investor Moves to Rustle Up Takeover Interest in Upper Crust Owner

Financial Times (09/25/25) Stacey, Stephanie; Barnes, Oliver

Irenic Capital Management, an activist hedge fund run by an Elliott Management alumnus, is trying to drum up interest in a take-private deal for Upper Crust owner SSP Group (SSPG) after boosting its stake in the food-to-go operator. The New York-based hedge fund is encouraging private equity groups to launch takeover bids for the London-listed company. The fund has shared materials about the merits of a leveraged buyout with investment bankers and private capital firms in recent weeks, according to a pitch deck seen by the Financial Times. Irenic argued that SSP could be valued at a 50% premium to its market value in a take-private deal, the deck said. The hedge fund points to SSP’s predictable revenues, its capacity to grow in US airports and ability to generate capital through the sale of non-core assets, including its stake in a listed Indian joint venture. Travel Food Services (TRAVELFOOD), the Indian venture in which SSP is a controlling shareholder, is valued at 177bn rupees (£1.48bn), compared with SSP’s market value of £1.25bn. SSP operates food outlets in railway stations and airports, including Upper Crust, Caffè Ritazza and franchised outposts of M&S Simply Food and Burger King. Irenic’s approach at SSP has apparent similarities with an activist campaign it launched in 2023 at Wagamama owner The Restaurant Group, which swiftly resulted in a £506mn sale to private equity group Apollo Management. The firm was co-founded in 2021 by Adam Katz, a former portfolio manager at Elliott Management, the world’s biggest activist hedge fund, and Andy Dodge. It is possible that none of the private equity groups being pitched by Irenic will decide to make a bid. Irenic declined to comment. SSP said: “We welcome the feedback and views of all our investors. We are entirely focused on delivering progress against our clear strategic priorities in order to deliver sustainable growth and returns for all of SSP’s stakeholders.” Irenic now owns roughly 3% of SSP’s stock, up from 2% when the Financial Times first revealed its stake in May, according to people familiar with the situation. SSP has struggled to recover after the Covid-19 pandemic because of the slow rebound in UK rail travel. Irenic has been pushing the company to boost its profit margins, the people said. Patrick Coveney, SSP chief executive, told shareholders on an earnings call in May that its post-Covid recovery “wasn’t yet delivering the margins, the returns and the cash flows that we — or you — rightly expect." SSP’s operating margin was 2.7% in the six months to March, down from 5% in the same period in 2019.

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9/25/2025

With CEO's Abrupt Exit, Portillo's Braces for an Activist-driven Overhaul

Crain's Chicago Business (09/25/25) Marotti, Ally

When Portillo’s (PTLO) went public in 2021, it had big growth plans. The Illinois-based Italian beef and hog dog chain believed that in 25 years, it could grow its 67 restaurants to more than 600. Two years later, tasting some success in new markets such as Texas, it boosted those plans. The target became 920 restaurants in 20 years. Those plans, however — and Portillo’s overall performance — have not panned out as expected. Portillo’s longtime CEO Michael Osanloo resigned earlier this week, effective immediately, shortly after the company reset its growth plans. “Our recent performance has not measured up to expectations,” Michael A. Miles Jr., the former chairman of the board who is taking over as acting CEO, said in a statement. “After careful consideration, the board believes, and Michael agrees, that now is the right time for a leadership transition." Founder Dick Portillo sold the company to private equity firm Berkshire Partners for $1 billion in 2014. Osanloo came on board as president and CEO in 2018. He took the company public in October 2021. The day Portillo's debuted on the Nasdaq exchange, shares landed at $29.10. Portillo’s stock passed $50 in the following weeks. But headwinds mounted, as post-pandemic inflation ripped through the food industry. Consumers pinched their pennies and cut back on dining out. Experts say competitors in the fast-food industry were better able to win consumers with value meals. The costs of opening Portillo’s restaurants also increased with inflation. Portillo’s stock was trading at about $6.50 today midday. “(Osanloo) made progress on the chain's operating problems, but the expansion was failing,” said Erik Gordon, a professor at the University of Michigan’s Ross School of Business. “It's not just that the stores are big. It's also that not everybody loves Chicago's favorite foods as much as Chicagoans love their food.” The expansion strategy Portillo’s laid out when it went public has become familiar: open restaurants in new markets full of Chicago snowbirds — largely, Sun Belt states such as Florida, Texas, and Arizona. Build out those markets to gain supply chain efficiencies. Pepper in new formats, like pickup-only spots. Then, let the people fall in love with Portillo’s. It went well at first. Portillo’s had an uncanny ability to get people through the line quickly. Combine that with the large footprints many of its Chicago stores had, and going into its IPO, its sales volumes were dwarfing competitors. Its locations averaged $7.5 million in annual sales in 2020, surpassing even McDonald’s $2.9 million average. Portillo’s grew that number to $9.1 million in 2023. That was the year it opened its first Texas location, outside of Dallas in The Colony. It found instant demand. So much that Portillo’s dialed back marketing efforts in later openings in the state — but that plan backfired. During a second-quarter earnings call on Aug. 5, the company reported that Texas had become a potential drag on its growth strategy. Second quarter revenue was almost flat, increasing 3.6% year-over-year to 188.5 million. “I think we’re lulled into a false sense of security with the success of The Colony,” Osanloo said during the call. Earlier this month, Portillo’s announced a strategic reset of its growth plans. It halted a breakfast pilot in Chicago, said it planned to “reinforce value” in its menu offerings and reduced its targeted restaurant openings to eight from 12 in fiscal year 2025. The next day, activist investor Engaged Capital bought more Portillo’s shares, establishing itself as the fifth-largest shareholder with 7% of the company. The hedge fund has been pushing for changes since it first took a stake in Portillo’s just over a year ago. It wants the company to continue expanding but slash the costs of doing so by shrinking new restaurant sizes and restructuring the way it deals with landlords. “After the bad quarterly news with the downward revisions to the company's projections, you sensed (Osanloo’s) remaining days were few,” Gordon said. “Shareholders, activist and passive, have limited patience.” It's likely whoever fills Osanloo’s shoes will likely be friendly to Engaged Capital’s requests, said Aaron Allen, founder and CEO of global chain restaurant advisory, Aaron Allen Associates. The focus going forward likely will be cost-cutting. “That’s what an activist investor does,” he said. “Whether they’re right or wrong, they’re paying attention and forcing others to pay attention to improve the performance — in the short term, at least.” Portillo’s has 95 restaurants in 10 states. The openings slated for 2026 are set to be among its most diverse formats yet. It will open its first restaurant in an airport, for example. Portillo’s will need to focus on finding the right footprint for its new locations, said Jim Salera, equity research analyst at investment bank Stephens. It also needs to strike the right balance between quality and value. “Getting the real estate strategy right, getting the pricing strategy right, those are going to be the two big areas of focus,” he said.

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9/25/2025

UBS Emergency Plan is Not ‘Executable,’ Says Swiss Regulator

Financial Times (09/25/25) Foy, Simon

Switzerland’s financial regulator has said that UBS Group’s (UBS) recovery and emergency plans, which banks are required to draw up in case of a crisis, have improved, but parts of the strategy remain insufficient. Finma on Thursday said that while UBS had made progress in improving its resolution strategy — commonly known as its “living will” — since its takeover of Credit Suisse in 2023, further changes to its emergency plan needed to be made. “UBS’s emergency plan largely fulfils the current statutory requirements,” Finma said in a statement. “However, it needs to be better integrated in the resolution plan in the future and thus cannot currently be regarded as executable.” UBS does meet Finma’s broader recovery and resolution requirements, with the regulator saying it had identified “further progress in UBS’s resolvability and continues to view a resolution as feasible.” The regulator’s intervention comes nearly a year after it ordered UBS to bolster its emergency and recovery plan in light of the added risk it had taken on following its state-orchestrated rescue of Credit Suisse. Large banks are required to provide their regulator with regular updates regarding their resolution strategies. These plans set out how they could be wound down safely to limit contagion in the market and are designed to limit the need for state bailouts if they run into trouble. Finma requires the banks it supervises to submit plans annually, which it shares with the Financial Stability Board, the international body that monitors risk in the global financial system. Finma’s intervention also comes amid a public feud between UBS and the Swiss political and regulatory establishment over strict new capital proposals, which would force the lender to have as much as $26 billion in extra capital. UBS is lobbying against the scale and speed of the reforms as they go through parliament. The bank has called the measures “extreme” and said they go further than those required of global peers, and would reduce its ability to compete internationally. Last week, activist investor Cevian Capital — a large UBS shareholder — said that the capital reforms meant it was “not viable” to run a large international bank from Switzerland, and that UBS would have “no other realistic option” but to leave the country unless the proposals changed.

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9/25/2025

BP Drops View That Oil Demand Could Peak as Soon as This Year

Bloomberg (09/25/25) Ferman, Mitchell

BP Plc (BP) said that oil demand is going to keep growing for the rest of this decade, rowing back on its prior projection that the high point could come as soon as this year. Rising consumption in emerging markets, sluggish energy efficiency gains, geopolitical tensions and the persisting use of petrochemicals all point to peak demand in 2030 at the earliest, the oil giant said in its once-a-year Energy Outlook. Consumption is now projected to reach 103.4 million barrels a day in five years, up from 102.2 million this year. President Donald Trump’s return to the White House has accelerated a global shift away from ambitious energy transition goals, with oil majors again focusing on their core fossil fuel businesses. BP in particular has been urged by activist investor Elliott Investment Management to prioritize oil and gas, and its new analysis lends weight to a pivot in that direction. BP said that, because energy efficiency gains have been “lackluster,” it’s resulted in increased demand that’s going to be met by fossil fuels. If prolonged, the situation could add 6 million barrels of oil a day to demand growth through 2035, BP Chief Economist Spencer Dale and his team said in the report. The company’s core expectation is that demand will start to return toward current levels around 2035. BP isn’t alone in backpedaling its view on the prospects for oil demand. The International Energy Agency is preparing a report this year that will show oil and gas demand will continue to rise beyond this decade, contrary to its previous assumption, Bloomberg Opinion’s Javier Blas said earlier this month. Fossil fuel use will rise out to 2050, he said, citing a draft report from the IEA. BP anticipates a long oil demand tail following 2035 under the world’s current path, with oil consumption seen at about 83 million barrels per day in 2050. Last year’s BP report showed 2050 consumption at roughly 75 million barrels per day. Meanwhile, the London-based firm sees rising natural gas demand in that time thanks largely to Asian imports of the fuel in liquefied cargoes. The US and Middle East stand to be the big suppliers of natural gas over that period, the report says. A new wild card is data-center demand tied to artificial intelligence. BP estimates that growth in data centers’ electricity use will account for around 10% of global power demand growth through 2035, and 40% of US power demand growth. The company simultaneously stressed the range of uncertainty of data center demand given rapid efficiency gains in chips and cooling technology. BP itself made big bets on renewables in recent years that turned into money-losing ventures. The firm reset its strategy earlier this year to return to focusing on oil and gas after years of under-performance. The report highlights that the use of biofuels, hydrogen and carbon capture, use and storage depend on government policies. BP and Shell Plc (SHEL) have both recently scrapped plans for biofuels plants in Europe.

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9/24/2025

Gerresheimer Suspected of Accounting Flaws

Reuters (09/24/25) Hogg, Bernadette; Burger, Ludwig

Shares in medical equipment maker Gerresheimer (GXIG) fell as much as 38% on Wednesday after Germany's financial regulator said it was investigating suspected accounting rule violations. Watchdog BaFin said it would review Gerresheimer's financial statements as of November 30, 2024, adding the company may have recognized revenue for some contracts with customers before the revenue was actually realized. Gerresheimer said in a statement that the revenues under review, which were recognized under so-called bill-and-hold agreements in fiscal year 2024, amounted to a "low double-digit million amount." It said overall revenues in fiscal 2024 were 2.04 billion euros ($2.40 billion) and that it believed that results were "appropriately recognized" in accordance with accounting regulations. "We take the supervisory authority's investigation very seriously. Transparency, compliance, and corporate governance are very important to us, the company's finance chief Wolf Lehmann said in the statement. Gerresheimer would cooperate fully with BaFin, it added. The group, whose products include injector pens for weight-loss drugs, vials and inhalers, said last month that finance chief Bernd Metzner was being replaced by Lehmann, a company outsider with a background in private equity. It said at the time that Metzner had resigned at his own request. Metzner has been in the spotlight following the failed sale of Gerresheimer to financial investors and a decline in the company's share price, with Active Ownership Capital (AOC) recently demanding that his position be re-examined. AOC, a major shareholder in Gerresheimer, previously said it saw major potential for value creation at the company and called for a strategic review, the second activist investor to do so. Sensitivities over accounting compliance have increased since the collapse of online payments company Wirecard in 2020 over a 1.9 billion euro hole in its balance sheet, turning the spotlight on regulators who took years to investigate allegations against the firm.

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9/24/2025

Tyler Proud, Brother of Former Dye & Durham CEO, Calls for Chairman to Step Down

Toronto Globe & Mail (09/24/25) Silcoff, Sean

Dye & Durham Ltd. (DYNDF) has been beset by a trio of fresh crises. On Wednesday, the holding company of former D&D chairman Tyler Proud, OneMove Capital Ltd., called for current chairman Arnaud Ajdler, founder of New York hedge fund Engine Capital LP, to step down immediately from the board, accusing him in a press release of overseeing “nine months of accelerating decline.” Once engaged by activist investors, Matt Proud is now a formidable shareholder gadfly himself. Proud also called for an immediate update on D&D’s “true financial position” after the Toronto real estate and business services software company said on Sept. 15 it wouldn’t be able to file its financial statements for its fiscal year ended June 30 by next Monday’s deadline. The company will be in a technical default on its senior debt unless it gets a waiver from its lenders. That news caused a steep selloff in the stock. “OneMove is fed up,” Proud said. “Engine promised a strategic plan for the company last December that we supported. Engine has not delivered on anything in that plan — all they have done is destroy value.” Ajdler did not respond to requests for a comment. Proud accused the company of leaving shareholders in dark and pressed for an update on a strategic review announced in July. Two sources familiar with the matter said the company has not yet hired a banker to run the process. “The company’s soaring leverage and strained liquidity leaves us deeply concerned that the board will undertake a rushed and flawed asset sale to distract shareholders,” Proud, who is an observer on the board, said in the release. Meanwhile, D&D’s newly hired chief executive officer, George Tsivin, has been sued by his former employer Relx Inc. (RELX), in New York Supreme Court. Relx alleges in the suit that Tsivin, who was a senior vice president, violated his 90-day notice requirement and 12-month non-compete agreement by accepting the job at D&D, a competitor in the legal software space. The suit was filed last month against Tsivin and Dye & Durham. The allegations have not been tested in court. The public move by OneMove is a significant blow as Proud was one of a key group of shareholders that supported a successful activist campaign led by Ajdler’s Engine Capital LP last year against D&D. The campaign led to the departure of Proud’s brother, Matt Proud, as CEO, and a complete replacement of the board with Engine’s handpicked slate. D&D said this month it wouldn’t be able to file its annual results on time after the Ontario Securities Commission raised questions about its financial statements related to goodwill impairment testing and purchase accounting disclosures. D&D said it didn’t expect any ensuing changes to impact prior results. BMO Capital Markets analyst Thanos Moschopoulos said in a note earlier this month he didn’t expect the development to impact his forecasts, adding “we presume that DND will be filing its financials in October. OneMove called on D&D to confirm whether it can meet its near-term debt obligations, and asked it to provide an outlook on the current quarter and to disclose if getting a waiver will restore D&D’s access to its revolving credit facility. The public dispute with Tyler Proud comes two months after D&D made peace with Matt Proud, who had launched own activist campaign against the company through his private holding company Plantro Ltd. following his departure. Under the standstill agreement the company appointed Plantro’s nominee David Danziger to the board and agreed to put itself up for sale for a second time in a year. That prompted David Barr, CEO of D&D shareholder PenderFund Capital Management, to remark “I think we’re now seeing the final season of my favorite daytime soap opera.” Matt Proud, meanwhile, has turned into an activist investor in his own right, pressing for changes through Plantro at TSX-listed Calian Group Ltd. (CLNFF) and Information Services Corp. (IRMTF). Tyler Proud’s OneMove also this month launched a public campaign against TSX-listed Sylogist Ltd. (SYZLF), calling for a special meeting of shareholders to vote in three of its directors nominees.

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9/24/2025

Tylenol Maker Kenvue Faces Mounting Crisis After Trump Blast

Bloomberg (09/24/25) Brown, Redd; Feeley, Jef

President Donald Trump created a potentially existential crisis for Tylenol maker Kenvue Inc. (KVUE) with just three words about the company’s most-recognized product: “don’t take it.” Trump’s warnings about the unproven link between Tylenol use during pregnancy to autism in children risks reinvigorating a barrage of litigation over the issue that the company has sought to put behind it. A federal court in December dismissed lawsuits alleging a link between the active ingredient in the over-the-counter pain treatment and the developmental disorder. The U.S. Food and Drug Administration has initiated the process for a label change to products containing acetaminophen that will say the ingredient is associated with a higher risk of autism in children when taken by pregnant women. It has also issued a related letter alerting physicians nationwide. If the FDA succeeds in forcing Kenvue to add the autism risks to Tylenol’s label, consumers who sue to hold the company responsible for their child’s autism will likely be able to use the new warnings as evidence in court, plaintiffs’ lawyers say. A renewed legal fight risks derailing an already embattled Kenvue that is struggling to revamp its business, turn around slowing sales and keep investors happy under interim CEO Kirk Perry. It also puts the maker of Tylenol in its biggest public relations crisis since seven people died after ingesting Tylenol capsules laced with cyanide in the 1980s. “On litigation, FDA’s notice states that a ‘causal relationship has not been established,’ said a spokesperson for Kenvue. “We stand with the science and believe we will continue to be successful in litigation as claims lack legal merit and scientific support.” The World Health Organization said Wednesday there is currently no conclusive scientific evidence linking autism and acetaminophen use during pregnancy despite extensive research. Kenvue could try to sue the federal government, but legal experts say the odds are slim that the company could win such a suit. Courts give the FDA wide latitude when it comes to weighing health risks, especially during pregnancy, said Lee. “The real question is whether Kenvue will sue simply as an effort to change the narrative, regardless of the legal validity of their claims,” said Elizabeth Burch, a University of Georgia law professor who specializes in product-liability law and the federal system for handling mass-tort cases. “Anyone can sue in this country. Whether that suit is meritorious or in good faith is a separate question for a judge to decide,” she added. Kenvue’s shares were little changed Wednesday morning. Kenvue’s stock has fallen 19% so far this year. The mounting legal risks come after a torrid period for Kenvue. In the two years after being spun off from Johnson & Johnson, the consumer products company struggled to find solid footing under CEO Thibaut Mongon, spurring activist investors to ramp up the pressure for changes. Earlier this year, Kenvue installed Jeffrey Smith, chief executive officer of Starboard Value, on its board to sidestep a proxy battle with the hedge fund. TOMS Capital Investment Management amassed a stake in the company with aims to push Kenvue to trim its portfolio. And in April, it was reported that hedge fund Third Point had built up a stake. Kenvue announced a series of changes this summer to respond to those investors, including installing Perry as interim CEO while the company looks for a permanent replacement. Kenvue also said it was undergoing a strategic review of its brand portfolio, which includes Neutrogena and Band-Aid, among others. The firm is reportedly considering the sale of some of its smaller skincare brands. The company is moving forward with plans to streamline brand management, including reorganizing leadership teams to a regional, rather than global model, according to a person familiar with the industry who was not authorized to speak on the matter. These changes are planned for January, this person said. “No decisions have been made, and we are not going to comment on rumors or speculation,” Melissa Witt, a spokesperson for Kenvue, said. The economic backdrop has not helped Kenvue’s situation as consumers have been pulling back on shopping under pressure from persistent inflation, a slowing labor market and high interest rates. The company’s organic sales have contracted for two consecutive quarters, a trend that analysts anticipate will continue in the third quarter. Kenvue slashed its full-year sales target last month as it struggled through execution issues that will likely linger through the remainder of the year. Tylenol contributes mid-to-high single digit percentage of sales, according to Morningstar analyst Keonhee Kim, making it Kenvue’s largest brand. In addition to exposing the company to a host of legal risks, the government’s warning against Tylenol could damage the brand and reduce consumption, Citi analyst Filippo Falorni wrote in a note to clients. It could also spook a broader set of consumers beyond expecting mothers, pushing them to use other pain reduction methods, Falorni added. The wider scientific community has warned that the government’s claims could create confusion for people attempting to treat fevers, an especially dangerous condition for pregnant mothers and their children.

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