...I think women don't go to Hooters because the food was shit and the restaurants looked like the inside of run down shacks. I don't go to Hooters because the food is so bad. If they improve the restaurants and improve the food, they will attract more customers...men and women.
There are restaurants in Vancouver where the hostesses wear far more revealing and tighter dresses than the outfits at Hooters...and they are packed with women customers, because the atmosphere is stylish and the food is terrific.
Sanjeev,
I could not find a good reason to invest in HOTR. You have not talked about reasoning behind investment in HOTR, what is holding you back?
Sanjeev -- do you know the guys at Chanticleer? Is that part of your rationale -- since they are basically value portfolio managers who get capital allocation?
Partly...and partly because somehow Mike Pruitt wheels and deals his way to get things to happen. I don't always agree with what happens at Chanticleer...high burn-rate of capital on a quarterly basis, abandoning the fund management side a bit to focus on the restaurants, audit committee failure regarding the fraud, hiring an IR firm, etc. But somehow Mike keeps things afloat when most other people would have hit a wall and collapsed. You can't teach that!
If the credit crisis did not happen, Chanticleer would have closed that initial deal with Texas Wings and Hooters Inc and we would not be having this conversation. Instead, they lost time, burned through the cash they had, Mike had to support the business himself, and then he finally wheeled and dealed his way to closing the entire consolidation of the Hooters brand, while getting the right to expand the brand internationally.
It is a bet for me on the people there, not on the business itself, margin of safety or anything else. It's solely on the people. I don't usually do that, but we've been with them a long time. We have not added to the stock recently, but would if it went below book. We're just going to go for a ride on this one, and see where it take us. Cheers!