When it comes to defending a company against an agitated investor, the devil you know may be better than the devil you don't.
That's the recent mindset among corporations and investors alike when it comes to fending off potential intruders — and it's increasingly blurring the lines of how management views the role of activist investors.
Case in point is Papa John's International. On Monday, the pizza maker announced that Starboard Value, led by Jeffrey Smith, would be investing as much as $250 million, and named Smith as chairman. For some, the move was surprising. Just four years ago, Fortune Magazine named Smith the "investor CEOs fear most" after Starboard upended the entire board at Darden amid a bruising proxy fight.
But rather than fear him, Papa John's welcomed Smith as a means of stability for the company after a year of chaos.
"We approached the company and said we want to get involved and we want to help and we want to provide leadership," Smith told CNBC's David Faber in an interview this week.
"Obviously, we're in a moment of distress here," Steve Ritchie, Papa John's CEO, said in the CNBC interview. "It's been a difficult year for the brand but we know we have a plan to do the right things to move forward."