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Wendy’s Continues Restaurant Sell Off

97 Fast-Food Eateries Sold in South Florida; Stores in More Markets Under Contract
September 26, 2016
JAE Restaurant Group, one of the country’s largest multi-unit franchisee of Wendy’s restaurants, has acquired another 97 new Wendy's restaurants throughout South Florida from The Wendy’s Co., which has been on a three-year effort to sell off its owned fast-food eateries to franchisees.

Terms of the South Florida deal were not disclosed. JAE Restaurant Group LLC now owns 177 Wendy's restaurants throughout Florida, Texas and New Mexico. In addition to its latest acquisition, JAE expects to open five new Wendy's restaurants in South Florida within the next six to eight months, with plans to open an average of 8 to 10 locations per year across all its markets.

The shifting from company-owned to franchise businesses is a part of Wendy’s brand transformation strategy, along with its ‘image activation’ program to remodel existing stores, a chain-wide effort to upgrade the street appearance and interiors by adding such features as fireplaces, more seating options, Wi-Fi and flat-screen TVs; digital menus and more.

“With these acquisitions comes a great deal of focus on the finance side of the business,” Eddie Rodriguez, CEO of Pompano Beach, Florida-based JAE Restaurant Group told his employees.

Each restaurant was individually valued, and the entire company was recapitalized to make the acquisition, he said.

“The recapitalization will allow us to build on the solid ‘image activation’ results and to build new restaurants,” he said.

During the first six months of the year, Wendy’s sold 55 restaurants to franchisees. The company expects to reduce company-owned restaurant ownership to approximately 5% of the total system with the sale of 258 restaurants during the remainder of 2016.

Additional markets where the fast-food chain plans to sell stores include Raleigh-Durham, New Orleans, New York, Chicago and Virginia Beach. In total, the company expects to sell $435 million of its restaurants.

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