Shares of Fat Brands tumbled as the company disclosed that CEO Andrew Wiederhorn is under investigation.
The US Attorney’s Office in Central California, along with the Securities and Exchange Commission, is looking into the company’s 2020 merger with Wiederhorn’s investment firm, Fog Cutter Capital Group.
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Shares of the restaurant chain fell more than 22% following the news.
|FAT||FAT BRANDS INC.||8.14||-2.42||-22.92%|
The Securities and Exchange Commission is “formally seeking documents and materials concerning, among other things, the Company’s December 2020 merger with Fog Cutter Capital Group Inc., transactions between these entities and Mr. Wiederhorn, and compensation, extensions of credit and other benefits or payments received by Mr. Wiederhorn or his family “according to the regulatory filing.
The company is cooperating with the government regarding these matters, and the company is not currently a target of the US Attorney’s investigation, according to the filing.
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FAT Brands owns Fatburger, Johnny Rockets, Twin Peaks and Fazoli’s, among others.