Fiesta Restaurant Group, Inc., parent company of the Pollo Tropical and Taco Cabana fast casual restaurant brands, announced that Tim Taft, Fiesta's CEO and president, has informed the board of directors that he has decided to retire as CEO, president, and a director of Fiesta at the end of the 2016 fiscal year.
Jack Smith, Fiesta's chairman of the board says, “On behalf of Fiesta's board of directors, we are extremely grateful to Tim for his outstanding leadership. Tim was instrumental in guiding the Company through its successful transition as an independent public company and during his tenure improved operations at both brands, refined our marketing strategies and set the stage for ongoing growth.”
Taft says, “I am deeply grateful to our board, management team, team members, and shareholders for the confidence and trust they have placed in me. I've been honored and privileged to lead this outstanding company and work with many wonderful colleagues, and they are largely responsible for the substantial growth and progress Fiesta has attained.”
A committee composed of independent directors of the company’s board will immediately commence a search for Taft's successor and work with him to facilitate a successful transition. This committee will be chaired by Stacey Rauch and will include Barry Alperin and Steve Elker. This committee will also consider the composition of the board and make any suggestions for continued enhancement. In addition, the company's board of directors has determined that, in light of this transition, as well as challenging market conditions affecting the entire industry, it intends to review the company’s strategic plan, including the previously announced separation of Taco Cabana. Mindful of Fiesta’s relatively low tax basis in Taco Cabana of around $60 million (as of year-end 2015), a tax-free spin-off may remain a viable route to maximizing shareholder value, however, the board intends to reconsider fully Fiesta’s options, including the possible continued ownership of Taco Cabana. The board will also review the company’s new store opening and capital expenditure plan in light of new market dynamics and recent operating performance, as well as the company’s leadership transition. Based upon this review the board will take such actions as it believes appropriate to optimize the company’s capital structure in light of its long-term capital needs.
Smith adds, “The board believes that Fiesta has a solid foundation to drive future growth and long-term profitability. We remain focused on taking the appropriate steps to maximize long-term shareholder value.”