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Operator of 314 Wendy’s locations in the US files for bankruptcy protection
The franchisee said it will keep restaurants open and pay employees while it seeks a court-supervised restructuring.
- Meritage Hospitality Group filed for Chapter 11 bankruptcy on Thursday in a Michigan court, operating 314 Wendy restaurants across 15 states that will remain open during restructuring.
- Deteriorating beef economics and what Meritage called "reduced frequency and effectiveness of Wendy's $WEN brand marketing" drove the collapse, as same-store sales fell for six consecutive quarters and Burger King reclaimed the second-biggest burger brand ranking.
- Court records show Meritage listed $651 million in liabilities against $725.9 million in assets. The company faces a "franchise termination dispute" with Wendy's franchising unit claiming $146.9 million in unpaid royalties and operations fees.
- Wendy's franchising unit delivered a notice on Sept 16 seeking to terminate Meritage's franchise rights "effective immediately," though Meritage disputes the termination and asserts its franchise rights remain intact during the case.
- Meritage leadership determined that "a voluntary, court-supervised restructuring is the most effective and proactive path to strengthen Meritage," with the company continuing to pay its roughly 8,850 employees during the process.
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Wendy’s is closing more stores: See a list of doomed locations from a major franchisee in ongoing bankruptcy
A sprawling Wendy’s franchisee that sought Chapter 11 bankruptcy protection earlier this month could close as many as 30 restaurants over the next few weeks as part of a cash collateral agreement, new court filings reveal. Meritage Hospitality Group, which operates 314 Wendy’s locations across 15 states, says it has already identified five unprofitable stores that it planned to shut down and vacate this weekend. In a bankruptcy docket filed lat…
·New York, United States
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Koco News5+25 Reposted by 25 other sources
Operator of 314 Wendy's locations in the US files for bankruptcy
The operator of 314 Wendy's locations in the U.S. has filed for bankruptcy after the restaurant chain tried to terminate its franchise agreement.
·Oklahoma City, United States
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Total News Sources125
Leaning Left11Leaning Right8Center62Last UpdatedBias Distribution76% Center
Bias Distribution
- 76% of the sources are Center
76% Center
14%
C 76%
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