DUBLIN, Ohio (AP) — Wendy's is selling 30 of its restaurants in the St. Louis market to a partnership that includes its second-largest franchisee and NBA player Chauncey Billups.
Financial terms were not disclosed.
The sale is part of Wendy's plan announced last month to sell about 425 company-run restaurants to franchise operators. Fast-food companies often own only a small percentage of their restaurants. This fattens their profit margins by reducing operating costs and lets them instead rely on fees paid by franchisees.
Wendy's anticipates completing the restaurant sales by the end of 2014's second quarter. The sales will reduce its ownership to 15 percent of its locations from 22 percent.
The hamburger company said Tuesday that the sale to BB St. Louis LLC includes 29 existing restaurants and one that is currently being built.
BB St. Louis includes Junior Bridgeman, a former NBA athlete. Bridgeman now has total or partial ownership of 196 Wendy's restaurants, making him the company's second-biggest franchisee. As for Billups, this is his first entry into the restaurant industry.
The deal between Wendy's and BB St. Louis calls for some of the restaurants being sold to be remodeled and also includes a development plan for new restaurants.
Wendy's has more than 6,500 franchise and company-run restaurants in the U.S. and 27 countries and U.S. territories globally. In July it reported that its second-quarter profit came in above Wall Street's expectations.
Shares of the Dublin, Ohio company added 6 cents to $8.04 in morning trading.