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ValueX Vail 2015: Biglari Holdings – Maran Capital

Maran Capital Management presentation on Biglari Holdings from the ValueX Vail, June 24, 2015.

Biglari Holdings - A ~50-65c Dollar

Price is what you pay:$410/sh(~$850mm market cap)

Value is what you get:

Executive Summary - Biglari Holdings (BH -$410):

  • Platform company comprised of cash, investments (largest holding: CBRL), and operating businesses Steak n Shake, Western Sizzlin’, Maxim, and First Guard
  • Run by Sardar Biglari: entrepreneurial CEO who is a proven operator and capital allocator
  • Core operating business Steak n Shake undergoing resurgent growth through capital-light franchising and traffic-driven same store sales
  • Significant Margin of Safety: the stock is trading close to cash/investments on the books net of all recourse debt and deferred tax liabilities
    • Investors are essentially getting Steak n Shake for free, and are paying nothing for any future capital allocation-driven upside
  • Conservative intrinsic value estimate: $650+ per share (and growing); potential for $800+ within three years
  • Opportunity created by complex structure, and controversy over corporate governance and executive...