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Consumer Stock Takeovers: Deals and Targets

On June 13, Wendy's Wendy's Arby's (WEN) agreed to sell its struggling Arby's chain to private equity group Roark Capital Group in deal that valued the sandwich chain at $430 million.


The deal did not come as a surprise as Wendy's has said it was looking for strategic alternatives for Arby's, which has trailed Wendy's performance.

Under the terms of the deal, Wendy's will retain an 18.5% stake in Arby's, which has more than 3,600 restaurants systemwide. Wendy's will receive $130 million in cash at the closing of the deal; its 18.5% stake is expected to be valued at around $30 million.


Atlanta-based Roark Capital Group will assume around $190 million in debt related to the Arby's chain, which mainly consists of capital lease and sale-leaseback obligations.

Wendy's expects to realize an income tax benefit of around $80 million over the next few years.

The deal was expected to close early in the third quarter.

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