Pleasant Lake Partners Boosts Del Taco & Hemisphere Media Stakes, Sends Letter to Magnachip

Jonathan Lennon's hedge fund firm Pleasant Lake Partners has filed numerous documents with the SEC lately regarding its positions.


Adds to Del Taco Restaurants Stake

First, Lennon's firm has boosted its stake in Del Taco Restaurants (TACO).  Per a Form 4 filed with the SEC, Pleasant Lake was out buying shares of TACO on August 28th and 31st at prices of $13.2 and $12.99. In total, they bought 107,400 shares and now own over 4.98 million TACO shares.  Pleasant Lake initially started a Del Taco stake a few months ago.

Per Google Finance, Del Taco is "a food service company. The Company operates quick service restaurant (QSR) chain under Del Taco in the United States. The Company offers Mexican- cuisine and American classics menu. Its menu includes various categories, such as tacos, burritos, Fresca bowls, American grill, quesadillas and nachos, desserts and shakes, sides and salads, combos and fiesta pack, kid's meals, drinks, breakfast, and Buck & Under. In addition, its menu includes Double Beef Classic Taco, Del Combo Burrito, Del Beef Burrito, MACHO Combo Burrito, Double Del Cheeseburger, Bacon Double Del Cheeseburger, Deluxe Chili Cheddar Fries, MACHO Nachos, Caramel Cheesecake Bites, Chocolate Chip Cookies, CrunchTada Tostada and Turkey CrunchTada Tostada, among others. The Company and its franchisees operate approximately 550 restaurants in 16 states."


Increases Hemisphere Media Position

Second, Pleasant Lake Partners has also filed a Form 4 regarding its position in Hemisphere Media (HMTV).  We covered earlier how this hedge fund has been buying HMTV shares and they're at it again.

Their filing notes they were accumulating more shares on August 27th, 28th, and 31st at prices of $13.58, $13.63, and $13.59.  In total, they bought 28,556 shares and now own over 1.94 million HMTV shares.

Per Google Finance, Hemisphere Media is "the United States Spanish-language media company serving the United States Hispanic and Latin American markets with approximately five Spanish-language cable television networks distributed in the United States, over two Spanish-language cable television networks distributed in Latin America, and is a broadcast television network in Puerto Rico. The Company owns and operates the Spanish language networks and content production platform, including movie and telenovela channels, two Hispanic entertainment genres, and the cable television networks. The Company's the United States Hispanic groups include WAPA is an independent broadcast television network; WAPA America is a Spanish-language cable television network; Cinelatino is the Spanish-language cable movie network; Pasiones is the Hispanic genre telenovelas; Centroamerica TV features news and entertainment programming, and Television Dominicana features news and entertainment programming.."


Sends Letter to Magnachip Semiconductor

We've previously posted Pleasant Lake's presentation on Magnachip Semiconductor (MX).  They now own 9.9% of the company, up from the previous 9.5% stake they held.  Lennon recently filed an amended 13D with the SEC and included this letter to the board:

"Dear Doug and Randal, 

As you know, funds managed by Pleasant Lake Partners (“PLP”) are one of the largest shareholders of Magnachip Semiconductor Corporation (“Magnachip” or the “Company”) with a 9.9% stake in the Company.  We have stated to you our desire to increase the size of our investment and have requested that the Board consider removing the Company’s poison pill.  We have also requested to be included in any upcoming auction process for the Company.  However, we have yet to receive a formal response to either request.  Furthermore, while the Company has formed a Strategic Review Committee, shareholders have seen little tangible progress to date.  We believe the Company needs major and immediate strategic change and that the best course for value maximization for all shareholders is to sell Magnachip.  Accordingly, in order to effectuate this, we are writing to you today to formally submit an indication of interest to purchase all of the outstanding shares of Magnachip that PLP does not currently own at a price of $10.00 per share in cash (the “Proposal”).  The Proposal represents a premium of approximately 29% to Friday’s closing price and approximately 58% to PLP’s average cost and is subject to confirmatory due diligence and the negotiation of definitive transaction documents. 

Since filing our 13D on June 10, we have sought to work constructively with you to realize the full value of these assets for the benefit of all shareholders.  And while we appreciate the time you have spent discussing these issues with us, the accelerating pace of consolidation in the semiconductor industry, coupled with what believe are Magnachip’s strategically valuable assets and intellectual property, has led us to make this Proposal.  We have consistently heard from other shareholders that the status quo at Magnachip is not acceptable and that the Company, in whole or in part, would be worth significantly more to strategic acquirers than as a standalone entity.  While we are obviously not such a strategic acquirer, we think shareholders should have the ability to decide for themselves whether to accept our Proposal at $10.00 per share, or wait for other potentially better offers; were any such offers to emerge, we would be prepared to vote our shares in favor of an offer that we believe is materially superior to our Proposal. 

We respectfully ask that you and the Board immediately engage with us to discuss the Proposal and negotiate a transaction.  We are prepared to devote all necessary resources to evaluate and consummate a transaction, and believe we can obtain the necessary financing to do so. 

We look forward to hearing from you and are ready to speak at your convenience.  

Sincerely, 
/s/ Jonathan Lennon
Managing Member
Pleasant Lake Partners LLC"

Pleasant Lake Partners Adds To Hemisphere Media Stake

Jonathan Lennon's hedge fund firm Pleasant Lake Partners has filed a Form 4 with the SEC regarding its position in Hemisphere Media (HMTV).  Per the filing, Pleasant Lake now owns over 1.92 million shares of HMTV.

They were out buying in the recent market decline on August 24th as well as the next two days.  In total, they bought 171,354 shares at prices of $12.75, $13.19, and $13.43.

They also show a position in Hemisphere warrants with an exercise price of $12 and an expiration of April 4th, 2018.  Hemisphere in general has been a longtime holding of the firm.

We've also highlighted other recent portfolio activity from Pleasant Lake Partners.

Per Google Finance, Hemisphere Media is "the United States Spanish-language media company serving the United States Hispanic and Latin American markets with approximately five Spanish-language cable television networks distributed in the United States, over two Spanish-language cable television networks distributed in Latin America, and is a broadcast television network in Puerto Rico. The Company owns and operates the Spanish language networks and content production platform, including movie and telenovela channels, two Hispanic entertainment genres, and the cable television networks. The Company's the United States Hispanic groups include WAPA is an independent broadcast television network; WAPA America is a Spanish-language cable television network; Cinelatino is the Spanish-language cable movie network; Pasiones is the Hispanic genre telenovelas; Centroamerica TV features news and entertainment programming, and Television Dominicana features news and entertainment programming.."

Pleasant Lake Partners' Presentation on Magnachip; Discloses Del Taco Stake

Jonathan Lennon's hedge fund firm Pleasant Lake Partners has filed an amended 13D with the SEC regarding its stake in Magnachip (MX).  Per the filing, Pleasant Lake owns 9.95% of the company and is one of the largest shareholders.  This is an increase from the 7.7% they owned when we highlighted their original 13D filing on Magnachip.

Pleasant Lake's Presentation on Magnachip

Included in its filing is a letter to Magnachip's chairman, as well as a presentation with their thoughts on the company.

Embedded below is Pleasant Lake's slideshow presentation on Magnachip:




Discloses Del Taco (TACO) Stake

Second, Pleasant Lake Partners has filed a 13G with the SEC regarding shares of Del Taco Restaurants (TACO).  Per the filing, Pleasant Lake now owns 11.5% of the company with over 4.46 million shares.

This is a newly disclosed position as they did not report ownership at the end of Q1.  The filing was made due to activity on June 30th.

Per Google Finance, Del Taco is "a food service company. The Company operates quick service restaurant (QSR) chain under Del Taco in the United States. The Company offers Mexican- cuisine and American classics menu. Its menu includes various categories, such as tacos, burritos, Fresca bowls, American grill, quesadillas and nachos, desserts and shakes, sides and salads, combos and fiesta pack, kid's meals, drinks, breakfast, and Buck & Under. In addition, its menu includes Double Beef Classic Taco, Del Combo Burrito, Del Beef Burrito, MACHO Combo Burrito, Double Del Cheeseburger, Bacon Double Del Cheeseburger, Deluxe Chili Cheddar Fries, MACHO Nachos, Caramel Cheesecake Bites, Chocolate Chip Cookies, CrunchTada Tostada and Turkey CrunchTada Tostada, among others. The Company and its franchisees operate approximately 550 restaurants in 16 states."

Pleasant Lake Partners Files 13D on MagnaChip

Jonathan Lennon's hedge fund firm Pleasant Lake Partners has filed a 13D with the SEC regarding its position in MagnaChip (MX).  Per the filing, Pleasant Lake now owns 7.7% of the ompany with over 2.64 million shares.

This is an increase over the 919,211 shares that they owned at the end of the first quarter.  The filing indicates they were out buying throughout April, May, and into June at a wide range of prices from as low as $5.37 to as high as $7.80.  They also bought call options that expire this week as well as in September at a $7.50 strike.  MX shares currently trade around $7.49.

The 13D filing also contains the standard boilerplate about potentially meeting with management, etc.


About Pleasant Lake Partners

Prior to launching his hedge fund, Lennon previously worked as a senior analyst at John Thaler's JAT Capital.  He founded Pleasant Lake in 2012 and runs a long/short equity strategy.


About Magna Chip

Per Google Finance, Magna Chip is "a South Korea-based designer and manufacturer of analog and mixed-signal semiconductor products for high-volume consumer applications. The company operates through three segments: Display Solutions, Power Solutions, and Semiconductor Manufacturing Services. Display Solutions products include display drivers that cover a range of flat panel displays and mobile multimedia devices. Its Power Solutions products include discrete and integrated circuit solutions for power management in high-volume consumer applications. Its Semiconductor Manufacturing Services segment provides specialty analog and mixed-signal foundry services for fabless semiconductor companies that serve the consumer, computing and wireless end markets."