Investors Bruise Applebee’s Parent

Wall Street Journal:

By sending DineEquity Inc.’s stock plunging 26% Tuesday, investors racheted up the pressure on the new owner of Applebee’s to deliver on its ambitious turnaround plans for the nation’s largest sit-down restaurant chain.
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The selloff came a day after the company announced that Chief Financial Officer Thomas Conforti had resigned, effective immediately. The company, which also owns the IHOP pancake chain, said Mr. Conforti left to “pursue other opportunities.” It said it agreed to give the departing executive a year’s salary, plus his average annual bonus and a one-year car allowance, among other things.

Mr. Conforti’s exit and the subsequent plunge in the stock raise doubts about how successfully DineEquity is digesting one of the biggest restaurant acquisitions in recent years. Last year, the company, then known as IHOP, agreed to buy Applebee’s for $2 billion in a complex deal Mr. Conforti helped to engineer. It was considered a bold move because IHOP had about half of the market capitalization of Applebee’s, and top executives at Applebee’s had claimed the deal was unfair to its shareholders.

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