Wendy’s has declined a $1.4 billion takeover offer from an investor group led by Nelson Peltz’s Trian Fund Management, which proposed $7.35 per share in cash to take the company private. The alliance also included BlueFive Capital, Sixth Street Partners, and one of Wendy’s largest franchisees, Flynn Group. Wendy’s board established an independent committee earlier this year to evaluate any potential bids from Trian, concluding that the offer significantly undervalued the company and did not account for expected benefits from its ongoing turnaround initiatives.

In response to the attempted acquisition, Wendy’s has implemented a poison pill shareholder rights plan with a one-year duration to deter any hostile takeover attempts. The investor group previously rejected Wendy’s offer for a standstill agreement, which would have limited further stock purchases. This latest development continues a long-term contentious relationship between Peltz and Wendy’s, with Peltz’s history in the company including a previous ownership stake through his firm Triarc and his current emeritus chairman position.

Despite the proposal rejection, Wendy’s reported better-than-expected third-quarter earnings and revenue results, though it noted a continued decline in same-store sales for the seventh consecutive quarter. The company expressed confidence in CEO Bob Wright’s leadership, highlighting his experience in business turnarounds as a key asset for the company’s future growth. Wendy’s stock fell less than 1% following the announcement, reflecting tempered investor reaction.

Wendy’s is not alone in facing activist investor pressure, as other restaurant companies like Applebee’s owner Dine Brands have also adopted defensive measures against takeover attempts. Wendy’s market value has dropped about 60% over the past three years, underscoring challenges in the sector and increasing interest from activist investors looking to capitalize on potential restructuring opportunities. The company’s rejection of the proposal marks a decisive move to maintain its current strategic direction.