Wendy's Considers Selling Chain

Back in February a story about Wendy's (the third largest burger chain) was posted about closing its original location, opened by Dave Thomas himself in 1969. Now it seems as though the entire chain may be up for sale.

DUBLIN, Ohio - Wendy's International Inc. announced Wednesday that it has created a special committee of directors to consider a possible sale of the company, among other options. Wendy's shares surged more than 12 percent in after-hours trading.

The nation's third-largest hamburger chain said it does not intend to make periodic announcements regarding the strategic review, which it said could mean a possible sale, merger or other business combination. Wendy's will report developments as warranted, the company said.

"There is no specific timeframe to complete the review and there are no constraints on options to be explored by the committee," said James V. Pickett, board chairman, who will lead the committee of independent directors.

"A number of stakeholders have offered suggestions about strategies to improve performance and create additional value. The special committee will review strategic options while management continues to focus on executing Wendy's current strategic plan to revitalize the brand and improve results at every restaurant in the system."

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Arby's to buy Wendy's?

Wendy's stock closed yesterday (July 30, 2007) at $33.69 per share, and SHOT UP $3.25 or 9.6% overnight as Billionaire investor Nelson Peltz, and his company Triarc takes AIM AT the 3rd largest  hamburger chain in the U.S. --- WENDY'S!  On Monday Peltz said he was ready to offer $37 to $41 per share for the company founded by Dave Thomas (links to flash presentation about Thomas) which would make the deal worth somewhere between $3.2 and $3.6 billion.

Triarc Companies, Inc. is a holding company and, through its subsidiaries, the franchisor of the Arby's and the owner and operator of over 1,000 Arby's restaurants located in the United States. With approximately 3,600 restaurants primarily in the United States, Arby's is the largest restaurant chain specializing in the roast beef sandwich segment and the 12th largest QSR chain overall.

Peltz in a letter to Wendy's chairman James Pickett said, Arby's would be a "natural strategic buyer" of Wendy's.  In the letter Peltz also said Triarc would be willing to raise the offer based on the outcome of its due-diligence.  Peltz set a deadline of 5 p.m. Wednesday for a Wendy's committee to respond to the offer and terms set out in a proposed confidentiality agreement.

Believe & Succeed,DaleFranSynergy, Inc.Synergizing Franchising!www.fransynergy.com

Wendys

Has anyone noticed that the Logo says "old fashioned Fingers", that's really in poor taste.

1 Large Shareholder says "SELL"

Well as previously posted here on Bluemaumau Wendy's recently formed a special commttee of directors to consider a possible sale of the company.

The Wall Street Journal has reported that the largest institutional shareholder of Wend's, Highfields Capital Management who owns 8.5%, has sent a letter to the company's chairman and directors this week urging them to seek buyers and expressed disappointment in recent marketing and operations initiatives.

Believe & Succeed,DaleFranSynergy, Inc.Synergizing Franchising!www.fransynergy.com

Wrong Wendy's Logo

Hadn't noticed that. The logo old fashioned fingers certainly is in poor taste - not that I've eaten any to know what they taste like. How did that sign get there?

What's next? Taco Bells of NYC displaying the sign, "Taco Bell, Think Outside the Rats"?

Frankman

When HQ Cannot Maximize Franchisee Wealth - Bye!

And let's not forget the key to this story - the franchisees. Highfelds sees more value to franchisees and shareholders in selling Wendy's.

Highfields said Wendy's decision to name Kerrii Anderson chief executive was "a mistake," and the company's efforts to improve marketing and operations "have been very disappointing..."

"We strongly believe that an auction to the highest bidder is the best way for the current board and management to maximize the value of the business," the letter said. "Let the shareholders get paid for the operational upside that clearly exists but cannot be delivered by current management and provide the franchisees with the marketing and cost support they deserve."

"Poor marketing, slow and unfriendly service, and bad relations with franchisees have contributed to lackluster sales in recent years." -- Wall Street Journal ($$)

Highfields Capital is thinking through the business mantra of why the corporate office and the franchisees exist -- to maximize stakeholder's wealth.

I suspect the marketing and operational teams at corporate are in for some change.

Frankman

Bob's bias

Frankman sees nothing wrong with chicken fingers dipped in BBQ sauce, yet he says it is in poor taste to eat old-fashioned fingers? What hypocrisy! And I bet that he has gotten the finger from folks he cut off in traffic, but he won't tell you that. And he'd give an arm and a leg to win the Lotto, no doubt.Fess up, Frankman!For those who are interested, I have a good marinade I am willing to share.