Cedar Enterprises sells its stores
WENDY’S
Longtime Wendy’s franchisee Cedar Enterprises, led by central Ohio’s Karam family, has sold its more than 200 restaurants.
Columbus-based Cedar first bought Wendy’s franchises in 1976 and grew to become the third-largest franchisee in recent years with stores spanning from Seattle to New England.
The sale of Cedar’s stores, which numbered close to 220, occurred sometime in the second quarter, which ended July 2, and was brokered by Wendy’s. Several companies bought the hundreds of stores, according to Wendy’s CEO Todd Penegor. He briefly acknowledged the transaction during Wendy’s second-quarter earnings call Wednesday morning.
No sales price was announced. Cedar Enterprises did not own any Wendy’s locations in central Ohio.
“Cedar’s portfolio was split among several strong operators with a demonstrated commitment to the growth and development of the Wendy’s brand,” said Wendy’s spokeswoman Heidi Schauer.
Attempts to reach Cedar Enterprises for comment were unsuccessful. The company’s phone system simply states that “Our office is currently closed.”
Penegor added during the call that Wendy’s has been talking to many longtime franchisees about succession plans. It all appears to be business as usual to Bob Welcher, president of Restaurant Consultants Inc.
“I think it is just normal business lifecycle,” Welcher said. “It’s like playing poker. You have to know when to hold them and when to fold them.”
The Karams, who have been less visible at Cedar in recent years as J. David Karam exited and became president and CEO of Sbarro, may have just decided that their interests lie elsewhere, Welcher said.
“People move on, retire, have different interests,” he said. “New franchisees might have more energy and be more aggressive, which is probably what Wendy’s is looking for.”
Cedar’s sale was overshadowed Wednesday by Wendy’s announcement that, in a separate deal to sell longtime franchisee DavCo’s stores, the company took a loss of $43 million. The DavCo sale is much higherprofile given the recent legal battle between Wendy’s and that franchisee.
Cedar Enterprises and J. David Karam were in the spotlight a decade ago when he and two private-equity companies announced they were putting together a bid to buy Wendy’s. The company was ultimately sold in 2008 to a firm owned by investor Nelson Peltz. Karam was then hired as president of Wendy’s North America operations, a position he held through the end of 2011.
Karam became CEO of pizza chain Sbarro in 2013 and moved Sbarro’s headquarters to Columbus following the company’s emergence from bankruptcy in 2014. Under Karam’s leadership, Sbarro has invested in new stores in central Ohio and a fastcasual pizza concept called Pizza Cucinova.