Wendy's Delivers Revitalization Plan

"We believe the tender offer is a wise use of the company's financial resources and that investing in our own shares is an attractive use of capital, as we are confident that our shares currently represent a compelling value," Wendy's said. "The tender offer will provide increased liquidity to shareholders, and it is consistent with the commitment we made to shareholders in 2005 to use the cash generated from our strategic initiatives to return value to shareholders."

In addition to the share repurchases, the company plans to pay an 8.5-cent dividend.

Earlier Thursday, Wendy's announced an agreement to sell its money-losing Baja Fresh Mexican chain to a West Coast restaurant operating company for about $31 million. The deal is expected to close during the fourth quarter, subject to customary closing conditions.

All these measures stem from a proxy fight waged earlier this year by Nelson Peltz, the billionaire investor who turned around the Snapple and Arby's brands. Peltz's Trian fund disclosed ownership of a 5.5% stake in Wendy's before launching a scathing attack on the company's management, which ultimately led to the retirement of its CEO, Jack Schuessler.

Schuessler was replaced on an interim basis by the company's chief financial officer, Kerrii Anderson. Wendy's is still looking for a permanent replacement.

After a long period of same-store sales declines, Wendy's last week posted its best quarterly comps performance in two years. The company recorded a 4.1% increase in comps at company-owned stores in the U.S. and a 3.9% gain at its domestic franchised restaurants.

"We fully expect the positive trends to continue through the end of the year and into 2007, and we are on target to reduce costs at Wendy's by $100 million beginning in 2007," said Wendy's in Thursday's press release.

Shares of Wendy's jumped $1.39, or 4.1%, Thursday to close at $34.11.