How Nelson Peltz Is Pulling Off Another Solid Win for Wendy’s
Wendy's shares saw a handy gain on Thursday after the company announced that it accepted an offer to sell its ownership interest in Inspire Brands back to that company. This is a solid win for Nelson Peltz and Wendy’s in…
This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.
Wendy’s Co. (NASDAQ: WEN) shares saw a handy gain on Thursday after the company announced that it accepted an offer to sell its 12.3% ownership interest in Inspire Brands back to that company for $450 million. This is a solid win for Nelson Peltz and Wendy’s in general.
Note that the agreement was approved by the Wendy’s board of directors and represents a 38% premium on Wendy’s previous valuation of the investment. Inspire Brands owns Arby’s, Buffalo Wild Wings and R Taco.
Wendy’s intends to use the proceeds from this transaction to invest in brand growth and increase the company’s share repurchase program.
[nativounit]
The board of directors has authorized a new share repurchase program for up to $100 million of the common stock through December 27, 2019. This is in addition to the current $175 million share repurchase authorization, expiring March 3, 2019, which had $93.1 million remaining as of August 1, 2018.
Nelson Peltz, Wendy’s board chair, commented:
The sale of our stake in Inspire Brands for $450 million is a great return on this investment for our shareholders. Over the past seven years, Wendy’s and its shareholders have benefitted from more than $100 million in distributions and the monetization of this investment carries a 38 percent premium over its most recent valuation.
Shares of Wendy’s were last seen up about 3.6% at $18.53, with a consensus analyst price target of $19.47 and a 52-week range of $13.57 to $18.55.
[recirclink id=486201]
[wallst_email_signup]
Contact [email protected] for any questions or corrections.
Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics. Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications. A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.
