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Trian Partners to broker deals with Wendy’s, company stocks surges



Image Source: Restaurant Clicks

Wendy’s, a popular burger chain, saw an unexpected 15% surge in stocks after Trian, their largest shareholder, announced possible future deals with the company.

In an effort to “enhance shareholder value,” Trian Partners has filed a hedge fund. Trian Partners currently holds about 19.4% of Wendy’s company share.

The firm was able to gather advisors together with Wendy’s higher-ups in order for them to share and discuss strategies and options.

According to the management, Wendy’s is open to any proposal since its goal as a company would be to maximize value for all stockholders. They further said that the board would openly accept bids or pitches from Trian Partners.

CEO and Founder of Trian Partners Nelson Peltz bought shares of Wendy’s in 2005. “At that time, Wendy’s was one of America’s most beloved brands, but the business had lost its way after the passing of its founder Dave Thomas,” said the firm recalling how they decided to buy stocks from the chain.

Today, Trian has three board seats in Wendy’s, and one is being held by its CEO.

The company has over 7,000 locations in the country. In the first quarter of this year, Wendy’s recorded a 2.4% increase in its sales – leading to its quarterly income of $37.4 million or 16 cents per share. In the same period last year, the company earned over $41.4 million, 10% more than this year.

Trian continues to aid the fast-food chain in developing its brand. According to Titan, Wendy’s should continue to improve its operations and solidify its brand among consumers.

For many years, the company has tried to innovate its menu to provide variety to its customers, including its own breakfast menu in March 2020. But the plan of the company to compete with fast-food giants like McDonald’s and Burger King was put to a halt because of the COVID-19 lockdowns.

Wendy’s restaurant chain, like many companies in the United States, faced problems and its sales plummeted after the government imposed lockdown restrictions.

Despite the problem, Wendy’s continued to serve their customers. Now that the market has reopened, the possibilities are now opening for the company as well – one such is the recent announcement by their shareholder, Trian Partners.

The worsening inflation rates in the country prompted BMO Capital Markets to downgrade Wendy’s market stocks, lowering its price target $22 from $28. Following the announcement by BMO, Wendy’s stocks dropped by 2.5%.

Management at Wendy’s is hopeful that the losses will be addressed with the new development – receiving funding from Trian. They have not announced how this fund would help them yet, but it should alleviate problems within the company.

Based in LA, Alice Blake is a senior reporter for Kivo Daily. She primarily covers entrepreneurs.