Shares of Wendy’s surged roughly 15% in extended trading Tuesday after a filing revealed hedge fund Trian Partners, its largest shareholder, is exploring a potential deal with the company.
Trian, along with its partners, owns a 19.4% stake in the burger chain and said it was seeking a deal to “enhance shareholder value” that could include an acquisition or merger, according to the filing.
The firm said it has retained advisors to evaluate strategic options and has discussed the scenarios with the Wendy’s board.
Trian, founded and run by Nelson Peltz, first invested in Wendy’s in 2005, when the fund was first launched.
“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,” the firm says in its portfolio listing.
The fund holds three board seats at the fast-food company. It has previously urged Wendy’s to reduce restaurant overhead, improve operations and build up its brand, according to Trian.
Wendy’s and its franchisees own about 7,000 restaurants. Global same-store sales grew 2.4% in the first quarter of 2022. The company reported quarterly net income of $37.4 million, or 17 cents per share, for the three-month period ended April 3 — nearly 10% down from $41.4 million, or 18 cents per share, during the same period in 2021.
Wendy’s stock is down 30% in the last 12 months, as of Tuesday’s close, and has a market value of about $3.5 billion.
–CNBC’s Steve Kopack contributed to this report.
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