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Trian pauses possible take-private bid for Wendy’s
The pause follows a takeover-driven rally that pushed Wendy’s shares up 14.7% on Aug. 12 and to a roughly nine-month high, after which shares fell more than 14% in after-hours trading.
Nelson Peltz’s Trian Fund Management is not planning an immediate take-private transaction for Wendy’s, even though it previously explored a potential bid, according to a Reuters report citing people familiar with the matter.
Trian, which owns about 16% of Wendy’s, had earlier been reported to be preparing a possible offer with a group that included BlueFive Capital and Flynn Group, a franchisee of the restaurant chain. The prospect of a takeover sent Wendy’s shares soaring 14.7% on Aug. 12, and the stock later reached a roughly nine-month high, lifting Wendy’s market capitalization to about $1.7 billion.
After news emerged that Trian was no longer planning to make an offer at this stage, Wendy’s shares fell more than 14% in after-hours trading on Wednesday. The sources said Trian remains concerned about Wendy’s recent performance, its share price and valuation, and the direction of the company’s strategy, while keeping its options open and potentially revisiting later.
Trian’s step back could provide Wendy’s newly appointed CEO Bob Wright additional time to implement a turnaround strategy. Wright, who took over in May, is the fourth leader at the Dublin, Ohio-based company in three years, as Wendy’s has struggled with weaker sales and recently lost its position as the second-largest US burger chain by sales. Wendy’s shares remain about 60% below their level from five years ago, the report said.