Feb. 12 - In the latest twist in the battle to control Wendy's International Inc., investor Nelson Peltz's firm said it wants to expand and gain control of the hamburger chain's board.
Mr. Peltz's firm, Trian Fund Management LP, said it wants to increase the size of Wendy's board to 15 directors from 13, according to a letter sent to the company. It would then push to get five of those seats in addition to the three it already has, giving it an eight-person majority if it wins.
It isn't clear what the move says about whether Wendy's will end up getting sold. Wendy's directors began weighing a sale last spring amid pressure from Mr. Peltz and because the chain's record of growth in sales and earnings has been mixed. In November, Triarc Cos., of which Mr. Peltz is chairman, offered to buy Wendy's for an undisclosed sum that it said was lower than the $37 to $41 a share the firm had initially indicated it would be willing to pay last summer.
In 4 p.m. New York Stock Exchange composite trading yesterday, Wendy's shares rose 42 cents, or 1.8%, to $23.57. A spokeswoman for Trian declined to comment. A spokeswoman for Wendy's didn't have an immediate comment.
Wendy's has struggled to increase sales and profit amid competition from other fast-food chains and a lack of popular new products. Its board is considering a variety of moves, including a deal, recapitalization or a change in business strategy. In its letter, which also was filed with the Securities and Exchange Commission, Trian said it hopes the board's review will result in a sale, but it didn't specify whether it favors a particular price or proposal.
Trian's attempt to control Wendy's board could suggest Triarc doesn't think it will end up buying the chain since, as its owner, it wouldn't need board seats to control the company. Trian said it had to submit the proposal for board seats now in order to make a deadline yesterday for shareholder proposals that will be considered at the company's annual meeting, which is expected to be in April. The board seats could be a backup strategy if Triarc doesn't end up buying the chain.
Trian said it plans to renominate a director -- Jerry W. Levin, chairman of Sharper Image Corp. -- who is up for re-election; its other two seats aren't up for re-election. New Trian nominees would be Jeffrey Bloomberg, a director at building-materials company Nortek Inc.; Ulysses Bridgeman Jr., president of Manna Inc., which operates 160 Wendy's Old Fashioned Hamburger restaurants; Kenneth Gilbert, a director at Trian Acquisition I Corp.; Richard Mandell, an investor and financial consultant; and Gregory Sachs, a director at specialty finance firm Deerfield Capital Corp.
If the proposal to expand the board isn't approved, Trian would push for six seats, renominating Mr. Levin and pushing Messrs. Bridgeman, Gilbert and Mandell for open seats.