An activist investor who acquires Shake Shack is seeking three seats on the board

• An investor wants three seats on the Shake Shack board to double profit in two years
• The Shake Shack’s stock price is about half of its all-time high in February 2021
• Engaged Capital wants to change its real estate strategy and store layout

A California investment firm is eyeing three seats on the Shake Shack board in a plan to bail out the burger chain as customers cut back on spending.

Shake Shack’s share price was high in early 2021 but it took a big hit as workers returned to offices in major cities after the pandemic slowed.

As of Monday, it was trading at around $70 after rising 50 percent in the past year, but still down from its all-time high of $130 in February 2021.

The Wall Street Journal reported Sunday that “activist investor” Engaged Capital now wants three board seats to implement changes it says will double earnings within two years. On Monday afternoon, its share price rose nearly 8 percent.

Engaged proposed changes to “Shake Shack real estate strategy, store design, business planning, and supply chain.” It did not respond to a request from DailyMail.com to clarify these strategies.

Activist investors like Engaged buy small stakes in public companies and try to change the way they are run by appointing people to the company’s board of directors.

Sometimes they use that power to promote worker welfare and other social causes, but often the goal is to maximize shareholder value.

Shake Shack has struggled to bring back diners in big cities as fewer people commute to offices each day.

The company’s market value is about $3 billion as of Monday — Engaged owns approximately 6.6 percent of the shares.

Engaged has been in talks with Shake Shack management for more than six months and sent a letter to the company’s board of directors in March detailing its proposal for new directors, according to the Journal.

“So far, management has been reluctant to commit to a time frame for restoring lost profitability,” Glenn Welling, founder and chief investment officer, said in the letter, seen by the newspaper.

The chain’s founder, Danny Meyer, currently controls the voting stakes, giving him the final say on key issues, but Engaged wants to put three people on the board.

The frontrunner is Kevin Reddy, a well-established investor in the restaurant industry who previously served as CEO of Noodles & Co.

Secondly, Joel Baines, who led the global retail practice at consulting firm AlixPartners and has experience in consumer-focused retail, branding and businesses.

The final nominee is Christopher Hetrick, Engaged co-founder and director of research.

Engaged has also suggested that Shake Shack get rid of its tiered board of directors, which means not all board members are up for election at the same time, the magazine reported.

“In order for the Company to reach its full growth potential and profitably expand this brand throughout the United States and the world, we believe that significant adjustments to the Company’s real estate strategy, store design, business planning, and supply chain framework are required,” Welling said.

In a statement to DailyMail.com, Shake Shack indicated its current share price.

“Our shares are up more than 50% since the start of the year, and we are well-positioned to continue to drive value for shareholders,” a Burger Joint spokesperson said.

“Looking ahead, we are guiding the full year of 2023 to be a record year… with expectations of returning margins at the restaurant level to 19 to 20%,” they said.

“We are executing on our strategic plan and making significant operational and financial progress.”

Shake Shack’s annual shareholder meeting is expected to take place in June.