Friday, April 18, 2008
Wendy's Disses Arby's Merger
Big news today that Wendy's has financially bitch-slapped the owners of Arby's by replying with an immediate 'No thanks, bro' to their takeover/merger offers.
Wendy's has been hitting some rocky ground in the past year after a few menu choices flopped. Adding insult to injury, I'm sure the rising cost of wheat coupled with the general economic recession made them a good target for a merger. Or so the big wigs at Trian Partners LP thought.
The Wendy's Board Committee rejected two alternate Trian offers less than 24 hours after receiving them.
Scorned like a jealous lover, the Arby's owners fired back with a public letter to the Wendy's shareholders begging them to put some pressure on the Exec board to accept an offer.
It is now time for Wendy's shareholders to decide the future of their company. We therefore intend to contact our fellow shareholders for the purpose of calling a special meeting of shareholders at which all shareholders will have the opportunity to vote on the future direction of Wendy's.
Did you catch those rapid-fire 'shareholders' references? That's how you play hardball, son!
The guys at Trian have done some good work in the past though. They are known for helping out popular food companies by swooping in and cutting costs, creating more efficient business models. It worked at Cadbury-Schweppes.
But Wendy's is a different story. Read any poster inside that joint and you'll know Dave Thomas was not a fan of cutting corners (hence the square patties). I wouldn't mind seeing an Arby's / Wendy's merger though, it would have some upsides for the consumer. Premium roast beef Baconator, anyone?
Reuters: Trian says Wendy's rejected 2 takeover offers, April 18, 2008
CNN Money: Trian 'very concerned' about Wendy's current direction, April 18, 2008
Comments
haha he did "son" us
haha he did "son" us =P
Contrary to the story that Peter
Contrary to the story that Peter May/Peltz is trying to spin, the Trian offer isn’t in the best interest of shareholders. In fact, Trian’s bid is an insult to shareholders, all one needs to do is to look at Arby’s performance under Trian’s leadership before everyone rushes to conclude that Peltz is a knight in shining armor. Arby’s has had no significant earnings since 2000, same store sales have been flat, and according to Zagat’s 2007 Fast Food Chains survey, Arby’s has “older†and “tired†facilities and “poor†service. To be sure, I don’t think Wendy’s needs this kind of guidance.
Peltz has a pretty poor record on corporate governance. During his proxy fight with Heinz back in 2006, the company responded to his calls for change with this: "Triarc received a corporate governance rating of 21.5, exceeding only 21.5% of all companies in the S&P SmallCap 600 and ranking it in the bottom quartile. Separately, Corporate Library gave Triarc an 'F' on overall board effectiveness -- the lowest possible rating." Zac Bissonnette, Blogging Stocks.
It’s time for the Special Committee to conclude this process. Keeping the company and its management team in limbo and at the mercy of Peltz and his minions for a year hasn’t been in anyone’s best interest, especially the shareholders. This management team knows it must deliver better results but they’re hamstrung to move forward until this special committee makes a decision. Wendy’s has made some important strides but they need the special committee process to conclude so that they can move forward.
did you really just "son" your
did you really just "son" your readers?