Peltz Signs Confidentiality Agreement With Wendy's

Burger chain Wendy's International has signed a confidentiality agreement with Nelson Peltz's Triarc Inc. and Trian Fund Management and given Peltz access to its books as he weighs a takeover bid. The Trian Fund holds a 9.8% stake in Wendy's, making it the company's largest shareholder. The agreement prevents Peltz from buying any more Wendy's shares before December 1. In July, Peltz, who also owns fast-food chain Arby's through Triarc, said Triarc would consider a bid for Wendy's in the $37-41 per share range. A $41 bid would value the company at $3.6 billion, a 25% premium over the shares' level the day Wendy's announced it would consider a sale. Peltz and other activist investors pushed Wendy's to spin off its Tim Hortons coffee-and-doughnut business and sell its Baja Fresh Mexican Grill restaurant chain. Peltz also holds stakes in Heinz, Cadbury Schweppes, Kraft Foods and Tiffany. Wendy's shares gained 2.2% to close at $32.69 Tuesday. Shares of Triarc fell 4.95% to $14.79.

Sources: Wall Street Journal, TheStreet.com, Bloomberg, Reuters
Commentary: Peltz's Trian/Triarc Enter Confidentiality Agreement with Wendy's International • Peltz Ready to Bid Up to $41/Share for Wendy's • Triarc Activist Peltz Attacks Wendy's Sale Process
Stocks/ETFs to watch: WEN, TRY. Competitors: BKC, MCD, YUM. ETFs: VCR, UCC, PBJ
Earnings call transcript: Wendy's Q2 2007

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Comments

[scott146:]

Wendy's had better get its act together quickly. Other chains have improved their menus and store ambiance. Wendy's food quality seems to be declining a little bit, and the fact that you have to go ask for a refill on a drink when every other chain lets you do unlimited refills self-service is a real annoyance. I suppose that stagnation is what you can expect when a charismatic leader of a company dies, though. I imagine there have been some power struggles since at Wendy's HQ since then.

2007 Aug 29 03:42 PM