Over the last couple of quarters, Wendy's International Inc. [WEN] investors such as Nelson Peltz have been asking company executives, "Where's the beef?" due to thin earnings. Now, Peltz's Triarc Cos. will be flipping burgers with its $2.34 billion offer to acquire Wendy's, headlining a number of deal developments that impacted Thursday midday trading. Investors were also looking at Blockbuster Inc.'s bid for electronics retailer Circuit City Stores Inc. as well as a sprinkling of earnings announcements of Deal Stocks. Overall, the Dow was trading up 66.03, or 0.5%, to 12,829.41 while the Nasdaq traded up 18.26, or 0.76%, to 2,423.47 in Thursday midday trading.
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Peltz's Triarc, the parent company of restaurant Arby's Restaurant Group Inc., pulled off its stock deal, offering Wendy's shareholders 4.25 shares of Triarc Class A common stock for each share of Wendy's stock. The deal values each Wendy's share at $26.78, or a 5.7% premium to Wednesday's close. Triarc will be adding 10,000 Wendy's restaurants to its 3,700 Arby's. The deal comes on top of Wendy's first-quarter earnings announcement that said earnings fell 72%. Shares of Wendy's rose 35 cents, or 1.38%, to $25.67, while Triarc slipped 3 cents, or 0.48%, to $6.27 in Wednesday midday trading.
Meanwhile, shares of Blockbuster rose 9 cents, or 3.12%, to $2.97 a share, as activist shareholders are pressing Circuit City to open its books to the video rental company. Wattles Capital Management LLC, which owns about 6.5% of electronics retailer Circuit City's stock, wrote in a letter that the target should allow access to the Dallas-based bidder and discuss the movie rental chain's buyout proposal along with other possible bids.
On the earnings front, Ford Motor Co., which sold Jaguar and Land Rover to an Indian automaker last month, surpassed analyst expectations, earning a $100 million profit buoyed by strong earnings in Europe and South America as well as a restructuring that trimmed 4,200 U.S. jobs through buyouts. The earnings surprise pushed the stock up 97 cents, or 12.88%, to $8.48.
Lastly, cell-phone maker Motorola Inc. [MOT], which announced last month it would shed its handset division, posted a loss of $194 million, or 9 cents a share, in the first quarter, widening from a loss of $181 million, or 8 cents a share, in the year-ago period. The weak earnings results pushed the stock down 41 cents, or 4.29%, to $9.13. - Gerald Magpily
