Wendy’s reveals restaurant sales
In July this year, the company announced it would “geographically concentrate its restaurant ownership” through the sale of 425 restaurants in 13 key US markets. “Restaurants are being sold to qualified operators on a market-by-market basis, with the completion of this process targeted by second quarter 2014,” the company said in a recent statement.
The latest set of sales were announced late last week, when Wendy’s revealed that its senior vice president of North America operations, John Peters, had formed a partnership with another Wendy’s franchisee, Rick Holland, to buy 38 sites in Phoenix.
As part of the agreement, Peters will lead operations for 73 of Holland’s restaurants in Arizona, Colorado, Michigan, South Dakota and Ohio. It is expected the deal will be finalised at the close of the first quarter in 2014. Wendy’s has now sold or signed agreements to sell 172 restaurants this year.
Wendy’s president and chief executive officer Emil Brolick said: “The company expects to generate a higher operating margin and stronger free cash flow, along with further enhancing the quality of its earnings with a more predictable revenue stream from a higher percentage of royalty and rental income. This transaction with John Peters will ensure that an important market – Phoenix – will be led by a superb operator and an experienced veteran of the Wendy’s system.”
John Peters added: “I am very excited about the opportunity to become a Wendy’s franchisee after more than 30 years with the Company. We are driving this brand toward a great future. We have a strong product pipeline, the best marketing awareness since the Dave Thomas campaign [featuring Wendy’s founder], a powerful way to connect with consumers through Image Activated [refurbished] facilities, and our restaurant operations continue to improve.”
More sales
The sale of 54 restaurants in Salt Lake City to a subsidiary of a Pizza Hut franchisee was also announced last week.
NPC International, which already owns 37 Wendy’s sites, is the eighth-largest Pizza Hut franchise operator in the US, with more than 1,200 restaurants.
Of the sale Brolick said: “We are very pleased with the strong interest in system optimisation that we’re receiving from our franchisee community. We view this as an excellent opportunity to grow our business with new and existing franchisees that are focused on operational excellence, have a strong balance sheet, and are fully committed to our restaurant reimaging effort.”
