Meritage acquires 25 new Wendy’s locations in North Carolina, Virginia

Meritage acquires 25 new Wendy’s locations in North Carolina, Virginia
Meritage Hospitality Group now operates a total of 385 restaurants across 16 states and employs about 12,000 people. Credit: Courtesy photo

Grand Rapids-based Meritage Hospitality Group Inc. has expanded its footprint in the southern U.S. with the acquisition of 25 new Wendy’s restaurants. 

The deal includes stores in North Carolina and Virginia that Meritage anticipates will add around $42 million in annual sales. Meritage funded the acquisition with cash, equity and bank financing. 

Executives say the transaction fits with the company’s five-year growth plan that began in 2020 and would have Meritage acquiring an operating base of 400 Wendy’s locations while building 52 new restaurants by the end of 2025 under the the franchisor’s Ground Breaker development program. 

Following today’s deal, Meritage now operates a total of 385 restaurants across 16 states. 

Meritage plans to integrate the new stores onto its operating and accounting platforms, as well as invest in remodeling and modernizing the spaces to the Wendy’s brand standards. 

“New Wendy’s restaurants continue to provide Meritage with a strong return on investment, as guests reward us for contemporary restaurant designs and digital enhancements,” CEO Robert Schermer, Jr said in a statement. “Restaurant acquisitions, renovations and new restaurant development are important components of our growth-oriented business model, providing unique long-term opportunities to employees and investors.”

The acquisition follows a string of deals and new restaurant openings for Meritage, which has most recently invested in the Taco John’s brand, opening four locations to date with 10-12 more planned to open this year. Meritage currently holds exclusive development rights in seven states as part of a 55-store development agreement, with additional rights to develop more than 205 Taco John’s restaurants. 

The latest expansions follow a record-setting $626 million in sales in 2022, an increase of 8.5% over the prior year. 

Meritage anticipates continued growth in 2023, with a projected increase of 90 to 100 percent in earnings from operations and net earnings income growth of 35 to 45 percent. The company expects to generate annual revenues in the range of $688.6 million to $719.9 million for this year.