Wendy’s Co., the operator of more than 6,500 fast-food restaurants, said Chief Executive Officer Roland Smith is stepping down this month as the company remakes its menu to compete with McDonald’s Corp.
Emil J. Brolick will take over as president and CEO on Sept. 12, Dublin, Ohio-based Wendy’s said in a statement today. Brolick, 63, currently is chief operating officer of Yum! Brands Inc., which owns the Taco Bell, KFC and Pizza Hut chains.
Smith, who sold the Arby’s sandwich brand earlier this year and moved Wendy’s headquarters from Atlanta to Ohio, has sought to draw customers from McDonald’s by remaking its breakfast menu. Smith has said he planned to use the proceeds from the Arby’s sale to invest in new products, ads and store remodels.
“As I made the decision with my board not to move to Dublin, we actually sought out and went after Emil,” Smith, 57, said in a telephone interview. Brolick will continue Wendy’s strategies, including new breakfast foods and cheeseburgers as “he believes it’s the exact right thing to do,” Smith said.
Wendy’s rose 16 cents, or 3.3 percent, to $5.03 at 11:01 a.m. in New York Stock Exchange composite trading. The shares had gained 5.4 percent this year before today.
Before joining Yum in 2000, Brolick had worked at Wendy’s for 12 years. Smith has been the CEO of Wendy’s since September 2008 and will serve as a senior adviser through the end of the year.
“We view the hiring of Emil as a very clear positive for Wendy’s,” said Mark Kalinowski, an analyst at Janney Montgomery Scott LLC in New York. Brolick has a “very data-driven, analytical mind” and is “arguably one of the best individuals out there that’s never been the CEO of a publicly traded company.” Kalinowski advises buying the shares.
Billionaire investor Nelson Peltz’s Trian Fund Management LP was the largest Wendy’s shareholder as of July 1, with 19 percent of the company, according to data compiled by Bloomberg. Peltz, who united Wendy’s and Arby’s in a $2.56 billion all- stock deal, also is the restaurant’s biggest individual investor.
Carrie Bloom, a spokeswoman for Trian, declined to comment on the management changes.
Roark Capital Group, an Atlanta-based buyout firm, bought 82 percent of the Arby’s chain in July in a deal valued at about $430 million. The sale undid the tie-up engineered by Peltz, who united the two brands in 2008. Peltz has said that Wendy’s has “substantial” growth potential.
Wendy’s revenue rose 2.5 percent to $622.5 million in the quarter ended July 3. Net income climbed 4.9 percent to $11.3 million in the quarter.
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