Wendy’s Company (NASDAQ:WEN) shares are trading higher Tuesday after a report said Nelson Peltz's Trian Fund Management is seeking investor backing for a potential bid to take the fast-food chain private.
- Wendy’s stock is charging ahead with explosive momentum. What’s fueling WEN momentum?
Wendy's Stock Jumps After Reported Buyout Discussions
According to the Financial Times, Trian has recently held discussions with outside investors, including investors in the Middle East, about financing a potential takeover of Wendy's.
Trian and Peltz currently own 16% of Wendy's. The activist investment firm has a long history with the company dating back to a 2005 activist campaign. Trian executive Peter May and Bradley Peltz, one of Nelson Peltz's sons, also sit on Wendy's board.
The report noted that Wendy's shares have fallen more than 40% over the past year and are down 71% over the last five years. The company last week reported weak quarterly results, citing high beef costs and soft traffic trends.
Trian said in a regulatory filing in February that Wendy's was "undervalued" and that it was considering strategic alternatives, including a potential takeover bid or reducing its stake in the company.
According to the report, Trian has not made a formal approach to acquire Wendy's and there is no guarantee that the financing discussions will result in a deal.
Wendy's said following Trian's February filing that it would "carefully evaluate" any takeover proposal if one materializes. The company is currently in the early stages of its "Fresh Start" turnaround plan aimed at improving U.S. sales and closing underperforming locations.
As of Monday's close, Wendy's had an enterprise value of approximately $5.1 billion.
Wendy’s Shares Move Higher
WEN Price Action: At the time of publication, Wendy’s shares are trading 15.38% higher at $7.80, according to data from Benzinga Pro.
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