Today Wendy’s announced that it will be selling off a majority stake in its roast beef sandwich touting offshoot Arby’s to private equity group Roark Capital.
Roark Capital has agreed to pay Wendy’s $130 million in cash for Arby’s, in addition to taking on $190 million in debts that Arby’s has accrued. Wendy’s itself will still continue to hold on to an 18.5 percent ownership share of Arby’s as well. According to Forbes, this combined with an $80 million tax benefit that should develop over the next few years has led Wendy’s to place the value of the deal at a total of $430 million.
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The report also quotes Wendy’s CEO Roland C. Smith, who notes optimistically that this new deal will “allow us to devote our full attention and resources on the exciting growth opportunities we have at Wendy’s.” Investors seem pleased with this new move as well. Shares in Wendy’s/Arby’s Group have risen 6.6 percent since the announcement according to the Wall Street Journal.
With this latest deal with Wendy’s/Arby’s Group, Roark Capital is accumulating properties and growing faster than a snowball rolling downhill. Just yesterday Restaurant News reported Roark Capital’s acquisition of Il Fornaio America Corp, which encompasses Il Fornaio, Canelleto Ristorante Veneto, and Corner Bakery Café. Through its Focus Brands platform, Roark Capital also owns such fast casual eateries as Carvel, Cinnabon, Seattle’s Best Coffee, and Wingstop.