Wendy's/Arby's Group Inc. completed the sale of Arby's Restaurant Group Inc. to private equity firm Roark Capital Group on Wednesday and dropped the roast beef sandwich chain from its name.
Wendy's will now focus solely on its burger chain and do business as The Wendy's Company. It will continue to trade under the ticker "WEN" on the New York Stock Exchange.
Arby's, meanwhile, will explore its own identity under private ownership.
Wendy's and Arby's were combined in 2008, but the combined company struggled since its formation, losing money seven of its 10 quarters.
The fast-food partnership was short-lived.
Wendy's/Arby's announced in January that it was looking for a buyer for the roast beef chain. Roark Capital Group, based in Atlanta, agreed in June to buy a majority stake in Arby's for $130 million and assume $190 million worth of Arby's debt.
Wendy's kept an 18.5 percent stake in the fast-food chain, which Wendy's CEO Roland Smith said last month signals the company's confidence in Arby's future.
Wendy's is nearly twice the size of Arby's with 6,600 restaurants versus Arby's 3,600. It produced about 70 percent of the company's revenue.
However, in the first quarter, Arby's was stronger by some measures. Its revenue rose by 5 percent from a year earlier, while Wendy's revenue fell less than 1 percent, though some of Arby's performance was likely due to price cuts.
Wendy's has said it plans to revamp the menu, including offering breakfast items, along with updating restaurants and building new locations in the U.S. and globally.
The company plans to release second-quarter financial results Aug. 11 before the market opens.
Arby's, meanwhile, says it will continue to build on the success of recent turnaround efforts, said Hala Moddelmog, its president.
The company did not fare well in the recession, it didn't offer new products as often and did not offer the value that some of its fast-food competitors did.
Arby's began in 2010 to revamp: It expanded its value menu and product offerings, and increased marketing. Moddelmog said the company will continue to expand those offerings and marketing.
The company also will get the benefit of Roark's restaurant expertise.
This is the 11th restaurant company Roark has purchased. Its stable also includes Carvel Ice Cream, Cinnabon, Auntie Anne's, Moe's Southwest Grill and some Seattle's Best Coffee outlets. It acquired Corner Bakery CafÉ and Il Fornaio Restaurants and Bakeries last month.
Roark has expertise in franchising, brand management and brand-building that the company can benefit from, Moddelmog said.
"Arby's has been around for 46 years, there is a lot of nostalgia and dedication to the brand," Moddelmog said. "But you need to build that brand every day."
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