Wendy's Fast-food Chain May Be Up for Sale

The United State's third largest hamburger chain says that they are considering a possible sale of their company, according to the Associated Press.

Wendy's International Inc. warned that this years profits would not meet Wall Street's expectations.

In a statement made by Wendy's chairman and head of a special committee thats doing the study, James V. Pickett said, "While a sale remains only one of the alternatives under consideration, we believe it merits more thorough examination."

Shareholders had put pressure on the company, which in turn formed a committee in April to see how they could boost Wendy's stock price. This may include a possible sale. A review will be conducted in part with the committee by the lead adviser, JP Morgan, and Lehman Brothers Inc., who are coadvisors.

The company is known for its popular Tim Hortons coffee-and-doughnut chain, and a sale of this magnitude would cap a whirlwind year the company has had. The company has also dumped Baja Fresh Mexican Grill after losing money on them, and laid off employees at its corporate office.

They say that it is not positive that a deal will be made.

A big portion of Wendy's stock is owned by Trian Partners, which is owned by billionaire investor Nelson Peltz. They have been pushing the company to make changes so that they will boost their sales. Peltz has three seats on the board, taken in march of 2006. The fast-food chain Arby's is owned by his company, Triac Cos.

$1.09 to $1.23 per share is the expected amount that Wendy's says they will make this year. Mostly because of weaker-than-expected sales at stores that have been open at least a year. Thats considered a key indicator of a retailer's strength. Also included in the factor is higher-than-expected commodity costs. The company has since withdrew its earnings forecasts for the years 2008 and 2009.

The chief executive of Wendy's, and also president, Kerrii Anderson, said that sales have been hurt in the last two months because of the rising costs of Wendy's food.