WESTLAKE, Ohio -- Activist shareholder Russell Glass is urging TravelCenters of America LLC (TA) to sell and lease back its real estate and to separate its truck repair business, reported Bloomberg, citing a letter to the company's board from Glass's RDG Capital Fund Management.
TravelCenters' property alone--made up of fuel stations, convenience stores and vacant land--may be worth $400 million, the news agency speculated, and a spinoff of its truck-repair chain at least $300 million. The fair market value of the company after such measures would be about $24 to $27 a share, Russell said.
"RDG believes TA is a highly attractive yet deeply undervalued company," Glass wrote in the letter, dated Feb. 23. "The company should command a premium, not discounted, valuation. We believe TA is misperceived as a slow growth, low-margin, commodity-oriented fuel company rather than the higher-margin, growing chain" of quick-service and full-service restaurants, convenience stores and truck repair facilities.
New York City-based RDG Capital described itself as a shareholder, without providing its stake. The investor is seeking talks with TravelCenters to help unlock hidden value in the company, which owns more than 250 truckstops off interstate highway exits in 43 states and Canada operating under the TA (about 175) and Petro Stopping Centers (nearly 80) brands, 577 full-service and quick-service restaurants (QSRs), 24-hour convenience stores, 240 heavy-truck repair and maintenance centers, RoadSquad Connect 24/7/365 emergency roadside services, Reserve-It truck parking reservations and many other services within large, high-traffic facilities. It also operates 34 gas stations and convenience stores in Kentucky and Tennessee under the Minit Mart brand name.
The Westlake, Ohio-based company's biggest shareholder is Hospitality Properties Trust, a real-estate investment trust (REIT).
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