Triarc Companies to Acquire Wendy's International Inc. for 0.97 Times Revenue

Weekly Corporate Growth Report, May 5, 2008

The Deal: Triac Companies Inc. has agreed to purchase Wendy's International Inc. in a deal valued at approximately $2.4 billion. Under the terms of the agreement, each share of Wendy's will be exchanged for 4.25 Class A shares of Triarc. Based on recent closing prices, the deal values Wendy's at $26.78 per share, a premium of 5.7 percent over Wendy's closing share price prior to the deal announcement. After the deal closes, current Wendy's shareholders will control about 80 percent of the combined company.The companies expect the transaction to close in the second half of 2008, subject to regulatory approvals.

Discussion: Wendy's International operates the world's third largest hamburger restaurant chain in terms of locations. The company operates more than 6,600 of its Wendy's Old Fashioned Hamburger outlets in the US and other countries. The Wendy's chain includes both company operated and franchised restaurants.

Triarc Companies, operating through its Arby's Restaurant Group subsidiary, operates a chain of nearly 3,700 fast-food sandwich restaurants. The Arby's chain has restaurants in most US states, as well as limited foreign locations. More than 1,100 locations are owned directly by the company while the rest are franchised.

After the deal closes, Wendy's and Arby's will continue to operate independently. Counting both restaurant chains, the combined company will operate about 10,000 fast food outlets.