Shares of Benihana jumped Tuesday after the restaurant chain said it is exploring strategic alternatives, including a possible sale, citing discord among its board of directors over the company's growth plans.
CEO Richard Stockinger said the board of directors is at odds over whether the company should raise capital and pursue an expansion plan or seek an alternative strategy.
"The combination of issues relating to raising new capital and the divergent views of these shareholders have made it extremely difficult for the company to implement with confidence a growth plan that would include organic growth as well as acquisitions at this time," Stockinger said.
As a result, the board has decided to conduct a formal review of the company's strategic alternatives, often Wall Street-speak for an acquisition or sale.
Benihana shares added 43 cents, or 7.7 percent, to finish at $6.03 on Tuesday. It shares have ranged between $3.44 and $9.55 over the past 52 weeks.
The company has struggled with rising costs and falling sales as the recession kept diners away from its tables. In March, the company announced the immediate departure of its chief financial officer and chief administrative officer, who was also the restaurant chain's president.
Still, the restaurant chain's fortunes have improved of late.
For its fiscal fourth quarter, Benihana said sales in restaurants open at least a year rose 1.4 percent—the first increase since the fiscal second quarter of 2008.
The company plans to hold its annual shareholders meeting on Sept. 14.