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Wendy’s International will ask for second round bids from interested buyers in the next two to three weeks, said a source familiar with the situation. Depending on the bids received by the company, a transaction announcement could occur shortly afterwards, or the company could take the process to another round of bidding, the source said.
Both Triarc and a group associated with Fidelity National Financial chairman, William Foley, remain interested suitors at this point, said the source. However, the source and an industry banker commented that franchisee Cedar Enterprises, which has been reported as an interested party, would not end up winning the auction, even with financial backing from Kelso and Oak Hill Capital Partners.
The source added that he agreed with Nelson Peltz’s statements regarding valuation, and that the company could see bids around the USD 37 to USD 41 range. Peltz has been also been reported as a known bidder. Despite media reports that Wendy’s had 12 potential buyers sign confidentiality agreements, the source said that buyers without a management team would probably be driven out of the process by those with experienced management on board, such as Peltz and William Foley. This meant that most standalone private equity interest would not be competitive, he said.
The financial press has also reported rumors that Yum Brands is involved in the Wendy’s auction.
Wendy’s shares have been trading around USD 34 during the mid-afternoon session.
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