Industry News | January 20, 2011
Is Wendy's Looking to Split with Arby's?
Wendy's/Arby's Group Inc., the third-largest quick-service restaurant company in the U.S., announced it is exploring strategic alternatives for Arby’s Restaurant Group Inc., including a sale of the brand. UBS Investment Bank is assisting in the process.
Arby’s is the second-largest quick-service sandwich chain in the U.S. with nearly 3,700 restaurants. Arby’s restaurants specialize in slow-roasted and freshly sliced roast beef sandwiches as well as Market Fresh deli-style sandwiches, toasted subs, and salads, all with the convenience of a drive thru.
“We believe the way to maximize shareholder value is to focus all of our management and financial resources on continuing to build the Wendy’s brand,” says Nelson Peltz, chairman of Wendy's/Arby's Group. “Arby’s is a good business, and we are making progress improving its performance, as evidenced by the 3.1 percent increase in company-operated same-store sales in the fourth quarter of 2010. However, despite Arby’s positive momentum, the reality is that the Wendy's brand, given its relative size and scope, is the key driver of shareholder return, and we believe we should focus on the execution of the compelling growth opportunities at Wendy’s.”
“Wendy’s currently has more than 6,500 restaurants in more than 20 countries and is one of the most attractive growth stories in the quick-service restaurant industry,” says Roland Smith, president and CEO of Wendy’s/Arby’s Group. “A pure-play Wendy's will enable us to focus all of our energies on growing the Wendy’s brand via new store growth both in North America and international markets, and with accelerated same-store sales through the introduction of new dayparts and core menu innovation.”
The company is planning to issue a news release after the market closes on January 26 with preliminary financial highlights for the 2010 fourth quarter and full year. At that time, the company also plans to provide a 2011 outlook. Wendy’s/Arby’s Group plans to issue more detailed fourth quarter and full-year 2010 financial results, as well as its 2010 Form 10-K, on March 3.
The company plans to host an Investor Day on January 27 at The Lighthouse at Chelsea Piers in New York City beginning with Wendy’s breakfast at 8:30 a.m. ET. Management plans to provide investors an overview of its Wendy’s and international businesses. The Investor Day presentations will be webcast live from the investor relations page of the company's website, and will also be archived there.
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