Hungry to whip Potbelly into shape

An activist investor wants Potbelly Sandwich Works to put itself on the block.

Cleveland-based investment firm Ancora Advisors sent the fast food chain’s board a letter Thursday, blasting it for its poor performance since the sandwich maker went public in 2013.

“Investors have experienced nothing but losses as owners of Potbelly,” Ancora Chief Executive Fred DiSanto griped, noting that shares are down more than 60 percent since its October 2013 IPO. Ancora has a 4 percent stake in Potbelly.

“We will not hesitate to use whatever

. means necessary to ensure that the best interests of the shareholders are represented,” DiSanto added.

Potbelly shares jumped as much as 3 percent following Ancora’s letter Thursday, closing at $11.45, up 1.8 percent.

Reps from Potbelly didn’t respond to requests for comment.

Although DiSanto pushed for an outright sale of Potbelly, he outlined areas for improvement whereby a sale might not be necessary. Rolling out kiosks instead of full-scale restaurants for new locations could cut costs, he said, while franchising more of the chain’s 454 locations would boost profitability. Currently, just 43 are franchised.

DiSanto is also pushing for Potbelly’s board to add a shareholder-appointed director to assist in the sandwich chain’s CEO search following last month’s announcement that Aylwin Lewis would be leaving the helm in August.

In addition to seeking a new CEO, DiSanto wrote that the board should create an executive compensation structure that is more aligned with shareholder returns.

“We would be happy to assist the board in identifying acceptable board candidates, and we reserve the right to potentially pursue board representation at next year’s annual meeting if necessary,” DiSanto wrote.