DUBLIN, Ohio — Wendy’s rejected a $1.4 billion buyout offer from an activist investor, saying Thursday the offer was too low and failed to take into account the company’s long-term earnings potential under its new CEO.
The Dublin, Ohio-based burger chain also said Thursday that its board of directors had adopted a “poison pill” plan intended to make it more difficult to pull off a hostile takeover of the company.
Renowned investor Nelson Peltz made an offer last week to buy the chain, which has been struggling with high beef prices and aging stores. Peltz said the fast food landscape had become increasingly challenging, with consumers under pressure, intensifying competition and persistent inflation, and that his offering was the best way forward for shareholders.
But during a conference call with investors Thursday, Wendy’s CEO Bob Wright, who joined the company in May, said Wendy’s has a turnaround plan in place that is already producing good results. Wright, who is the fourth CEO to lead Wendy’s since 2024, previously served as chairman and CEO of Potbelly. He also held senior management positions at Wendy’s, Checkers and Domino’s Pizza.
“We are confident we have the right strategy, execution and resources to restore Wendy’s to its full potential and generate significant shareholder value,” Wright said.
Shares rose less than 1% on Thursday as the company reported better-than-expected third-quarter performance.
Wendy’s said in a statement that a committee of independent directors unanimously rejected the offer because it “significantly undervalued” the company.
The Wendy’s Shareholder Rights Plan – commonly referred to as the “poison pill” plan – grants all shareholders except a hostile bidder the right to purchase shares at a discount and dilute the hostile bidder’s ownership interest. It is triggered automatically if a person or group owns 15% or more of Wendy’s stock.
Peltz’s Trian Fund Management and other partners in the investor group that made the offer to Wendy’s own 16.3% of the company’s stock. The plan would remain in effect for a year, Wendy’s said.
Trian did not immediately respond to a request for comment Thursday. Peltz served as chairman of the board of Wendy’s for 17 years until 2024. His son Bradley Peltz still serves on the company’s board of directors and is a Wendy’s franchisee.
Dine Brands, the parent company of Applebee’s and IHOP, adopted a similar year-long poison pill plan last week to fend off a takeover bid by two investment firms.
Founded in 1969 by Dave Thomas and named for his daughter, Wendy’s is known for its square burgers and frozen desserts. The fast-growing chain introduced the drive-thru window in 1970 and went public in 1976. In the 1980s, while competing for sales with McDonald’s and Burger King, Wendy’s introduced salad bars and introduced its iconic “Where’s the Beef?” advertising campaign.
But as the fast food market became even more competitive and rival burger-focused chains like In-N-Out and Five Guys expanded, Wendy’s fell behind. Wendy’s share of the burger chain’s U.S. sales fell from 11.5% in 2019 to 10.4% last year, according to Technomic, a market research firm.
The industry has also seen a decline in U.S. traffic, particularly from lower-income customers, as high gas prices and affordability concerns strain household budgets. In the third quarter, foot traffic fell 2.6% across the U.S. fast food industry, according to Revenue Management Solutions, a restaurant industry consultant.
Wendy’s has been closing outdated U.S. restaurants so it can focus on its most profitable locations. The company closed 240 restaurants in 2024 and announced earlier this year that it planned to close up to 358 locations in 2026.
Then, in September, one of Wendy’s largest U.S. franchisees filed for bankruptcy protection after the chain attempted to terminate its franchise agreement. Michigan-based Meritage Hospitality Group operates 314 Wendy’s restaurants in 15 states.
Under Wright, Wendy’s launched a turnaround plan dubbed “Dave’s Way,” which calls for improved food quality, more distinctive marketing, and improved digital ordering and restaurant operations.
Wright said Thursday that Wendy’s began testing quality improvements, including thicker, crispier bacon, creamier Frosties and whole lettuce on sandwiches. The company is removing low-volume items from its menus to reduce the complexity of its kitchens and is making breakfast optional, allowing franchisees to focus on the most profitable times of the day.
Wendy’s on Thursday reported revenue of $547 million for the July-September period. That’s better than the $531 million Wall Street expected, according to analysts surveyed by FactSet. Wendy’s same-store sales, or sales at stores open at least a year, fell 5.2%, which was also better than the 6.4% drop analysts expected.
At the end of 2025, Wendy’s had 5,969 restaurants in the United States and 1,428 locations in 38 countries.
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