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Arby's Swallows Up Wendy's
Associated Press ^ | 4-24-08

Posted on 04/24/2008 7:24:09 PM PDT by kingattax

Roast Beef Sandwich Chain Buys Square Burger Biz For $2 Billion

(AP) After two past rejections, the owner of Arby's shaved roast beef sandwich restaurants is buying Wendy's, the fast-food chain famous for its made-to-order square hamburgers and chocolate Frosty dessert, for around $2 billion.

Triarc Companies Inc., which is owned by billionaire investor Nelson Peltz, said Thursday it will pay about $2.34 billion in an all-stock deal for the nation's third-largest hamburger chain started in 1969 by Dave Thomas. Wendy's had rejected at least two buyout offers from Triarc.

Thomas' daughter Pam Thomas Farber said the family was devastated by the news.

"It's a very sad day for Wendy's, and our family. We just didn't think this would be the outcome," said Farber, 53.

If her father were alive to hear news of the buyout, "he would not be amused," she said.

Thomas became a household face when he began pitching his burgers and fries in television commercials in 1989.

Wendy's International Inc. deferred comment to Triarc, which had nothing further to say right away.

Triarc will pay about $26.78 per share for the company, which has about 87 million shares outstanding. The price is a premium of 6 percent from the company's closing price of $25.32 Wednesday.

Under the terms of the deal, which is expected to close in the second half of the year, shareholders at Wendy's will receive 4.25 shares of Triarc Class A stock for each share of Wendy's stock they own.

Atlanta-based Triarc said its shareholders will have to approve a charter amendment in which each share of its Class B stock will be converted into Class A stock.

The Wendy's board has been studying strategic alternatives since early last year, and expenses related to that contributed to the company's 72 percent drop in first-quarter earning announced Thursday.

Wendy's said its profits totaled $4.1 million, or 5 cents, a share for the quarter ended March 30 compared with a profit of $14.7 million, or 15 cents a share, a year ago. Revenue was down slightly to $513 million from $522 million a year ago.

Wendy's stock is well off its high for the past year of $42.22 that it reached shortly after the committee began its work in the summer. It fell 3 cents to $25.39 in early trading Thursday.

Sales have slid in a struggling economy that has hurt other restaurant chains, too.

The deal caps two chaotic years for Wendy's in which it has sold or spun off operations, slashed its corporate staff and had its wholesome image tarnished by a woman who falsely claimed she found part of a finger in her chili.

Triarc said it will also change its name to include the Wendy's name.

Pushed by activist shareholders, Wendy's spun off its Tim Hortons coffee-and-doughnut chain and sold its money-losing Baja Fresh Mexican Grill. Chairman and CEO Jack Schuessler abruptly retired in March 2006, months after a woman and her husband were sentenced to prison for extortion for their plot in March 2005 to plant part of a human finger in a bowl of chili at a San Jose, Calif., Wendy's restaurant and claiming it was served to her.

Farber said the family didn't think much of Peltz' and Triarc's tactics.

"They came after them (Wendy's) and came after them and came after them. They spun Tim Hortons off, they did this, they did that. They did everything they asked but it wasn't enough."

Farber said she had just gotten off the phone with her sister Wendy, 46, the company's namesake.

"She's feeling horrible. She just is devastated," Farber said.

Farber said the family had a supported an alternate bid led by Wendy's franchisee David Karam, president of Cedar Enterprises Inc.

"We knew what Dave Karam's commitment was to Wendy's, his family's commitment — just as ours. His dad was a very good friend of our dad's and was one of the very first franchisees, so there's a lot of history."

Peltz, who runs the Trian Fund, and his allies own 9.8 percent of Wendy's stock. Arby's has more than 3,000 restaurants.

He had argued in a letter to Wendy's chairman James Pickett that Triac would be a natural buyer of Wendy's. Peltz gained three seats on the company's board last year.

Thomas, who died in 2002, opened his first restaurant in a former steakhouse on a cold, snowy Saturday in downtown Columbus on Nov. 15, 1969. He named the chain after his 8-year-old daughter Melinda Lou — nicknamed Wendy by her siblings.

The smiling Thomas, always wearing a white short-sleeved shirt and red tie, touted the virtues of fast food in humorous ads, often featuring big-name stars such as bluesman B.B. King and soap opera queen Susan Lucci. He appeared in more than 800 ads.

Wendy's, based in suburban Dublin, operates about 6,600 restaurants in the United States and abroad. It trails McDonald's and Burger King Holdings Inc. in the burger business.



TOPICS: Business/Economy; News/Current Events
KEYWORDS: arbys; fastfood; wendys
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To: acoulterfan
"LOL! First time I have laughed all evening."

So happy to contribute.

61 posted on 04/24/2008 8:10:02 PM PDT by davisfh ( Islam is a serious mental illness)
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To: OeOeO

Actually, my two favorite condiments are Horsey sauce and Wendy’s chille sauce.


62 posted on 04/24/2008 8:10:21 PM PDT by lesser_satan (Vote McCain - The Choice who Sucks Less!)
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To: kingattax

In a manner of speaking. A guy a few years ago claims to have gotten the sliced skin off the side of somebody’s finger. When he went back to the store, a worker had a bandage on his finger.


63 posted on 04/24/2008 8:11:46 PM PDT by Rastus
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To: kingattax; Emperor Palpatine

http://www.youtube.com/watch?v=4w88Mz_Q154

http://www.youtube.com/watch?v=Ug75diEyiA0


64 posted on 04/24/2008 8:13:59 PM PDT by Republican Wildcat
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To: kingattax
FAST FOOD FIGHT!

Photobucket

65 posted on 04/24/2008 8:14:23 PM PDT by lesser_satan (Vote McCain - The Choice who Sucks Less!)
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To: Fester Chugabrew
Meanwhile I'd like to give the finger to a certain extortionist and her “willing accomplices in the media.”

The judge should have ordered a large chili, placed the finger in the chili and made her finish it!

66 posted on 04/24/2008 8:14:42 PM PDT by Grizzled Bear ("Does not play well with others.")
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To: kingattax

All your Wendy’s are belong to us!


67 posted on 04/24/2008 8:16:12 PM PDT by Desron13 (If you constantly vote between the lesser of two evils then evil is your ultimate destination.)
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To: rwfromkansas

There’s no 99 cent menu anymore, there’s the Value Menu. It seems like a lot of things are $1.19 or $1.29 now.


68 posted on 04/24/2008 8:17:13 PM PDT by toothfairy86
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To: Republican Wildcat

“where’s the beef” was one of the all-time most successful TV ads for any industry. a classic.


69 posted on 04/24/2008 8:18:13 PM PDT by kingattax (99 % of liberals give the rest a bad name)
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To: mkjessup

Roy Rogers has two stores near me in Alexandria VA....


70 posted on 04/24/2008 8:18:16 PM PDT by Fundamentally Fair (There was once consensus that the world was flat.)
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To: Minn

71 posted on 04/24/2008 8:19:03 PM PDT by PetroniusMaximus
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To: Petronski
the owner of Arby's shaved roast beef sandwich restaurants is buying Wendy's

So is Arby going to shave Wendy?
72 posted on 04/24/2008 8:20:23 PM PDT by aruanan
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To: kingattax
They use “deli” meat. “Deli” meat is a little bit of turkey, ham, beef or other namesake meat, massively injected with flavorings, preservatives, water, and miscellaneous finely ground human body parts. (That is why you could not find a human thumb in it, without doing DNA type tests.)

It is pureed, liquified, cooked, and formed into the shapes of real meat. It is then sliced very thin and passed off as “meat”. It is not. It is just very expensive meat flavored bologna.

I think Wendy's is the loser here. At least, the last time I ate any of it, it tasted like ground beef. They couldn't make much money. Too much cheaper competition from McDonald's, Burger King, et al.

73 posted on 04/24/2008 8:22:31 PM PDT by tdscpa
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To: the invisib1e hand
headline is pitiful. How about, “Arby’s has Wendy’s in the Bag,” or “Arby and Wendy tie the knot” or some such.

How about: 'Wendy's Gives Arby's the Finger in a Chili Reception to the News of their Buyout.'

74 posted on 04/24/2008 8:25:24 PM PDT by eldoradude (Jimmy Carter, exiled former U.S. president, committed suicide this morning...)
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To: allmendream

Roy Rogers in “Greenbrier area”, Fairfax VA, still open, I think.

I will check this summer.


75 posted on 04/24/2008 8:28:29 PM PDT by 3D-JOY
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To: MarkL

Arby’s roast beef is hardly beef. It tastes like roast beef (artificially flavored).


76 posted on 04/24/2008 8:28:57 PM PDT by LadyFeline
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To: Steely Tom
Triarc said it will also change its name to include the Wendy's name.

Wendy of Triarc.

77 posted on 04/24/2008 8:30:57 PM PDT by JerseyHighlander
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To: SeafoodGumbo
Their menu looks very close to Guthrie’s
78 posted on 04/24/2008 8:31:36 PM PDT by Fundamentally Fair (There was once consensus that the world was flat.)
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To: 3D-JOY

Sounds right. I ate at the one in Fairfax across from George Mason University.


79 posted on 04/24/2008 8:31:39 PM PDT by allmendream (Life begins at the moment of contraception. ;))
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To: kingattax

First thing I thought of wow, that is too funny


80 posted on 04/24/2008 8:35:16 PM PDT by shadeaud
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