Dan Loeb, who runs hedge fund Third Point, on Wednesday urged Soho House directors to run a “fair” sales process and consider other potential bidders after the hospitality group received a take-private offer late last year.
The billionaire investor called the $9 a share offer made last year a “sweetheart” deal and added that he thinks other parties with experience investing in the hospitality sector may be interested in the asset.
Third Point owns a nearly 10% stake in the operator of exclusive private clubs and Loeb, in a letter to the Soho House board, said he approves of returning the company to private ownership. News of Loeb’s involvement pushed Soho House shares up 4% Wednesday after closing at $7.37 a share on Tuesday. The company is valued at roughly $1.4 billion.
Soho House has been public since 2021 but struggled financially. To take it private, Loeb writes that Soho House’s board engaged in a “sweetheart” deal with its chairman, Ron Burkle, who runs investment firm Yucaipa.
“Burkle’s obvious conflicts of interest and undue influence on the board via his super-voting share class make it imperative that the Board open the sale process to outside bidders,” the letter said.
A Soho House representative was not immediately available for comment.
