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Wendy's/Arby's next takeover target
June 10, 2010
Private equity firms have demonstrated a large appetite for quick-service brands, beginning with CKE Restaurants and its Carl's Jr. and Hardee's brands. And their hunger shows no signs of satiation, with Wendy's and Arby's next on the table. Nelson Peltz's Trian Fund Management LP, the biggest shareholder in Wendy's/Arby's Group Inc., said in a regulatory filing that the fund manager has been "approached by a third party about the possibility of participating in a takeover of the fast-food chain," Bloomberg reports.
From the story:
Trian is considering the inquiry and other alternatives, the fund manager said in a regulatory filing yesterday. Trian and its affiliates hold about 23.6 percent of Atlanta-based Wendy's/Arby's. The stock advanced 31 cents, or 7.1 percent, to $4.65 at 10:13 a.m. in New York Stock Exchange trading.
Arby's has struggled to shore up sliding same-store sales during the recession and recently brought in industry veteran Hala Moddelmog to lead the brand's turn around.Arby's reported in May that its first quarter North America systemwide comps were down 11.5 percent.
Wendy's has done better, with North America systemwide comps up 0.8 percent for the quarter, but still lags behind McDonald's, which reported earlier this week that its U.S. same-store sales were up 3.4 percent for May.
Trian was the subject of unsubstantiated rumors earlier this year as a prospective buyer of CKE.
Other QSR brands bought up in the PE feeding frenzy include Captain D's Seafood Kitchen, put up for sale in January by then-parent company Sagittarius Brands. The sale to a Sun Capital affiliate was completed in May for an undisclosed sum.
NexCen Brands, which owns five QSR brands including Pretzelmaker and Great American Cookies, reported in May that it agreed to a $112.5 million offer from an affiliate of independent investment firm Levine Leichtman Capital Partners.
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