Wendy’s largest shareholder explores fast food chain purchase amid rising costs

Fast food restaurant chain Wendy’s may be up for sale as the restaurant struggles with rising commodity and labor costs.

According to a May 24 filing with the US Securities and Exchange Commission, The Wendy’s Company chairman Nelson Peltz said his fund manager, Trian Partners, wants to explore a possible sale or merger of the restaurant chain.

Trian Fund Management owns 19 percent of the company and is the largest shareholder.

“Such a potential transaction could include an acquisition, a business combination such as a merger, or other transaction that would result in the applicants acquiring control of the company,” Exhibit 13D/A states.

In a statement posted on its website on May 24, Wendy’s said its board of directors would carefully consider any proposals submitted by Trian Partners “in accordance with its fiduciary duties.”

“Wendy’s Board of Directors and Management regularly review the company’s strategic priorities and capabilities to maximize value for all shareholders,” the company said in a statement. “Our board is committed to continuing to act in the best interests of the company and its shareholders.”

The move by Peltz, who has been a director of the company since 2008, saw Wendy’s stock jump 15 percent after business hours on May 25. The stock is currently trading up 9.77 percent.

Earlier in May, Wendy’s said in its first-quarter earnings report that global sales were up 4.2% in the first three months of 2022, compared to a 12.5% ​​increase in the same period in 2021.

The company reported global sales of approximately $3.1 million in the first quarter of 2022, compared to $2.951 million in sales in 2021. However, the company noted that it is facing higher operating costs associated with rising costs of goods and labor, as well as the impact of its investment in opening 50 restaurants in the United Kingdom this year.

Net income fell to $37.4 million in the first quarter, down nearly 10% from the same period last year.

“We’ve had one of the best quarters in our history for division growth, with over 90 new restaurant openings, and we are on track to meet our planned divisional net growth target of 5 to 6 percent per year,” said the president and chief executive officer. Todd Penegore. while talking about income.

Penegor also noted that the fast food chain is “well positioned to win in this volatile environment” thanks to “strong franchisee alignment with their strategies” and “strengthening the balance sheet with a successful debt deal we recently completed.”

“By paying constant attention to the implementation of our key priorities, we are confident that we will be able to realize our vision and become the most prosperous and beloved restaurant brand in the world.”

Wendy’s was founded by Dave Thomas in Columbus, Ohio in 1969. The company has about 7,000 restaurants around the world.

To follow

Catabella Roberts is a reporter currently based in Turkey. She covers news and business for The Epoch Times, with a focus on the United States.


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