Ramius disappointed by Luby's election results

By Lisa Kerner

Charlotte, N.C., Jan. 15 - Preliminary results show that Luby's, Inc. shareholders re-elected the incumbents to the company's board of directors, despite a push by Starboard Value and Opportunity Master Fund Ltd., an affiliate of RCG Starboard Advisors, LLC and Ramius Capital Group, LLC, for the election of its slate of nominees.

Luby's shareholders voted at a special meeting on Tuesday to re-elect Dr. Judith B. Craven, Arthur R. Emerson, Frank Markantonis and Gasper Mir III, a company news release confirmed.

Ramius wanted Luby's shareholders to elect Stephen Farrar, William J. Fox, Brian G. Grube and Matthew Q. Pannek.

Luby's and Ramius had been battling for shareholder support for their respective nominees.

It was also announced that Luby's two largest shareholders, Chris and Harris Pappas, intend to vote in favor of a proposal to declassify the board, which requires an 80% favorable vote of the outstanding stock for approval.

Despite Ramius' disappointment in the results, the investor said it believes a strong message has been sent that the independent board members must be accountable to the independent shareholders.

"The preliminary indications show that a majority of the independent shareholders of Luby's voted in favor of changes to the composition of the Luby's board," Ramius partner Jeffrey C. Smith said in a Ramius news release.

"In fact, if you exclude the Pappases' share ownership above the 15% poison pill threshold from the vote, it appears that a majority of shares voting would have supported change to the Luby's board of directors."

Luby's had a different take on the voting results.

"Today's vote demonstrates that Luby's shareholders believe we are taking the right steps, with the right board and management team, to build shareholder value," Luby's president and chief executive office Chris Pappas said in the release.

"We are very excited about our strategic growth plan to build 45 to 50 new restaurants over the next five years; upgrade and remodel Luby's existing restaurants; and grow the company's culinary contract business to provide food service at healthcare facilities."

Luby's is a Houston-based restaurant operator.

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