Poison Pill Pizza?
It’s been a rough year for Papa John’s, to be sure. PJ’s founder and former CEO John Schnatter has pulled company into political issues by complaining about being forced to provide employees healthcare through the ACA, and blaming the NFL’s anthem kneel controversy for declining sales, since the chain is closely aligned to the league through a long-standing sponsorship. The latest coup de gras blunder involved Mr. Schnatter openly using the “N” word during a conference call with one of its media agencies. In response to the mounting PR disaster PJ’s Board of Directors decided to terminate its relationship with Mr. Schnatter and unceremoniously evicted him from their HQ office a few weeks ago.
That could have been the end of a bad chapter for Papa John’s, and provided a chance for the pizza maker to reset itself and move forward. However, it appears that the Papa himself may be looking to reassert control of the company. According to multiple reports, John Schnatter feels that he was unfairly ousted from the company and is exploring ways to regain control of the chain he founded. Since Schnatter is still the largest single shareholder, with 29% ownership, it’s very possible he could force Board maneuvers to restore himself to the helm. As a response PJ’s current Board is considering implementing a “poison pill” provision in its bylaws to make a takeover attempt financially ruinous to the company. Swallowing a poison pill could keep Schnatter out of the Board room, but it would also hurt Papa John’s as a whole including its other investors.
Who ever knew there could be this much drama around a simple dough ball with tomatoes, cheese and a few toppings on it?!?