Monday, October 22, 2007

Would Wendy's take a check?

I’m thinking of bidding $4 billion for Wendy’s, but why make Nelson Peltz any richer? The worth of his stake in the company may already be bobbing higher because of speculation he’ll offer $3.2 billion—speculation some say he’s conjured with all the high-profile yelping about his treatment as a potential buyer.

After all, several of the other identified suitors have insisted the company’s not worth that much. Through his various companies, Peltz controls about 9 million Wendy’s shares. If he can bluff another bidder into raising its offer by even a few dollars per share, he’ll be in Frosties for life. And if he scares them away with his posturing, he could swoop in with a low-ball deal and bag the company with the M&A equivalent of an order off the Super Value menu. This is why I’m slaving away at a keyboard and he could pay the King to cut his lawn, with Mayor McCheese handling the edger.

So why not have my 15 minutes of fame and talk up a plan to bid $4 billion? As more and more observers are suggesting, my contemplated offer may be just as real as Peltz’s.

I’d call and check that with him but—well, you know. I’d have an easier time dragging the Pope out for some foosball.

1 comment:

  1. I think it is interesting that Wendy's has said that its board is evaluating three strategic options to improve Wendy’s performance: evolving the current strategic plan, changing its capital structure or a possible sale, merger or combination and the only one getting any air time is a sale to Nelson Peltz. How about the current management team that has been working hard on this turnaround for only 9 months and already showing great strides. Kerrii Anderson and her team have delivered 16 straight months of same store growth, appreciation in stock price, higher profits and positive earnings growth, and they are moving ahead with the second phase of their plan that makes a lot of sense. If the turnaround is already happening, it doesn't seem like killing that momentum is in the best interest of shareholders.