TL;DR
Wendy's plans to sell 640 company-owned restaurants to franchisees to increase cash and lower expenses. The brand expects to generate $400-$475 million in pretax income from the sale.
On the heels of news that Wendy’s will be partnering with Honest Tea to bring an organic product to its menu, the brand announced today it is planning to sell 640 restaurants in the United States and Canada to franchisees to increase cash and lower expenses.
The brand had previously announced its plans to sell certain restaurants to lower the number of company-operated locations, and plans on now selling 380 restaurants by year’s end and 260 restaurants next year. This plan will give the brand $400-$475 million in pretax income and “significantly reduce future capital expenditure requirements.”
"Going forward, we intend to buy and sell restaurants opportunistically to act as a catalyst for growth by further strengthening our franchisee base, driving new restaurant development and accelerating Image Activation adoption," CEO Emil Brolick said in a statement.
The Dublin, Ohio-based brand posted first quarter earnings of $27.5 million compared to $46.3 million one year ago.
In this story
This story was originally published in 1851 Franchise on May 6, 2015. Burnaze summarizes and links to the original reporting.
Read the full story at 1851 FranchiseLiked this? Get the week's franchise news, explained
- Sunday 8 AM ET weekly + a monthly deep dive
- Sections picked for the industries you follow
- Every claim linked to its source. Free.