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Sale Will Bring Wendy's Under Arby's Hat

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The Associated Press

Published: September 16, 2008

NEW YORK - Shareholders of Wendy's and Triarc approved a $2.34 billion deal on Monday that will make the nation's No. 3 hamburger chain a part of billionaire investor Nelson Peltz's empire.

Triarc Cos. shareholders voted from New York, while shareholders of Dublin, Ohio-based Wendy's International approved the deal from the company's headquarters. Directors of both companies had already approved the transaction.

Atlanta-based Triarc operates the Arby's fast-food chain and is owned by Peltz. Triarc said in April it would buy Wendy's for $26.78 per share in an all-stock deal, after the chain known for its square hamburgers and the Frosty dessert rejected at least two earlier offers by Peltz.

Triarc said it will change its name to Wendy's/Arby's Group Inc. and will trade under the WEN symbol on the New York Stock Exchange. Triarc Chief Executive Officer Roland Smith will take over as CEO of Wendy's; Kerrii B. Anderson, the current CEO, will step down.

Smith has said job cuts will likely be necessary, but he has yet to provide details on those plans. He offered no new details in the company's statement but said more information would be forthcoming once the deal closes.

"We believe our combination represents a major strategic opportunity to create significant long-term value for all of our stakeholders, and we are working on a comprehensive integration plan and organizational structure to support enhanced operating performance at both brands," Smith said in the statement.

Smith has said Wendy's headquarters will remain in Ohio, and Arby's will stay based in Atlanta.

Wendy's spokesman Denny Lynch said the company will "remain focused on running our business and doing the best we can to continue the turnaround at Wendy's."

The acquisition of the chain Dave Thomas launched in Columbus in 1969 comes as consumers are increasingly cutting back on discretionary spending and commodity costs are taking bites out of restaurant profits.

Wendy's has been hit harder than its fast-food competitors. Last month, the company reported lower second-quarter profit and sales, saying its results have been hurt by higher grain and fuel prices.

Under the terms of the deal, Wendy's shareholders will receive 4.25 shares of Triarc's Class A stock for each share of Wendy's stock they own. Each outstanding Class B share will be converted into one Class A share. Once the deal closes, expected on Sept. 29, the combined company will have only one class of stock.

Besides approving the acquisition, Triarc shareholders also voted to add a member to its board and accepted the resignation of one of its board members, Russell V. Umphenour Jr., to make room for two Wendy's directors - Janet Hill and J. Randolph Lewis.

Hill is vice president of corporate consulting firm Alexander & Associates Inc. Lewis is senior vice president of distribution and logistics at Walgreen Co.

A FULL TABLE

Billionaire investor Nelson Peltz, whose Triarc Cos. is acquiring hamburger chain Wendy's, now either owns or has a stake in a number of food companies and brands:

•Wendy's International

•Arby's Restaurant Group

•H.J. Heinz Co.

•Hanson Natural Corp.

•P.F. Chang's China Bistro

•The Cheesecake Factory

•Kraft Foods

•Dr Pepper Snapple Group

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