“The Board of Directors will carefully review any proposal submitted by Trian Partners,” Wendy’s said in a statement on Tuesday, adding, “We remain focused on achieving our vision of becoming the most thriving and beloved brand in the world.”
But breakfast hasn’t been enough to boost sales significantly in recent months.
“The breakfast environment has undoubtedly been challenging across the industry … affecting our full-year breakfast sales growth forecast,” CEO Todd Benigor said during a call with an analyst earlier this month.
“However, we had strong results in the breakfast period,” Benegor added. He said Wendy’s has increased its share of that meal compared to other fast food restaurants. In the first quarter, sales at Wendy’s restaurants that have been open for at least a year increased 1.1%.
Wendy’s has also been hit hard by rising costs for goods and labor, and said its margins have narrowed as a result.
Although investors may be excited about the company’s acquisition, some have warned that it could be a tough sell.
“We believe the sale of Wendy’s may not be straightforward” due to the strength of its competitors, Cowen analyst Andrew Charles said in a note on Tuesday.
He added that many large restaurant owners already have a burger chain in their portfolio and may not be excited about adding another – or taking McDonald’s head-on.
Wendy’s is not only a competing brand, but [Restaurant Brands] And [Yum] Focused on international development and looking to reduce direct competition with McDonald’s, particularly domestically, where 85% of Wendy’s is located.”
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