Wendy’s long-suffering stock gets a boost after reports that billionaire Nelson Peltz wants to take it private

The Wendy’s Company could go private if billionaire Nelson Peltz has anything to say about it.

The Trian Fund Management cofounder is looking for outside investors to help with a takeover of Wendy’s, the Financial Times reports. The news isn’t exactly surprising—in February, Trian used its regulatory filing to announce it might sell its stake or attempt a takeover of Wendy’s. 

Peltz and Trian currently own a 16% stake in Wendy’s, along with the Peltz family’s minority stake in a New York-area Wendy’s franchise owner. Peltz’s son, Bradley Peltz, and Trian cofounder and president Peter May are also on the board of Wendy’s.

Fast Company reached out to Trian and Wendy’s for comment.

Shares of The Wendy’s Company (Nasdaq: WEN) rose almost 17% yesterday on the news but the stock was essentially flat in premarket trading on Wednesday. Accounting for yesterday’s boost, the stock is down roughly 33% over the past 12 months.  

Taking major retail chains private is not a new strategy. In recent years, Denny’s, Walgreens, and Barnes & Noble have all gone private. 

What’s going on at Wendy’s?

Like many fast-food restaurants, Wendy’s has been struggling. On May 8, the company released first-quarter results that beat analysts’ estimates but saw disappointments like a 7.8% drop in U.S. same-restaurant sales.

It also reported a net loss of 174 U.S. restaurants over the last two quarters. 

Wendy’s did see 3.3% revenue growth year-over-year (YOY), with its international stores (1,446 locations compared to 5,805 in the U.S.) seeing more success. The fast food company announced that it will launch up to 1,000 locations across China in the next decade.

In October, Wendy’s announced Project Fresh, a turnaround plan that includes brand revitalization, system optimization, and capital allocation, among other changes to drive growth and profits. On an investor call the following month, Wendy’s further elaborated on a plan that would also include the closure of hundreds of U.S. locations. 

In its most recent report, Wendy’s interim CEO Ken Cook expressed confidence in the plan, stating, “While our first quarter results reflect a business in the early stages of a turnaround, we are making progress to improve our U.S. business and are confident in the direction we are heading.”

Wendy’s has yet to comment on Trian’s potential bid, but it said in February that it would “carefully evaluate” one if it appeared.

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