Wendy’s Co. and Pizza Hut LLC are raising concerns over their largest franchisee’s effort to sell its assets, including the franchise agreements, in bankruptcy court, WSJ Pro Bankruptcy reported. NPC International Inc., which operates 392 Wendy’s and 1,200 Pizza Hut restaurants, filed for bankruptcy in July with a plan to find buyers for its assets. The company’s franchisee agreements with the restaurant operators are the most valuable assets it is marketing in its sale process. Both Wendy’s and Pizza Hut have recently warned in filings with the U.S. Bankruptcy Court in Houston that they are uneasy about any sales of the franchise pacts to third parties. Wendy’s said that the company doesn’t have enough say at an early stage over which interested bidders can participate in the sale process. Meanwhile, Pizza Hut claims NPC can’t sell its Pizza Hut restaurants to a third party since it has failed to keep up performance at a level required by its franchise agreement. Binding bids for the Wendy’s and Pizza Hut restaurants are due on Oct. 20 and Nov. 5, respectively. Bids for all of NPC’s assets are also due Nov. 5, court filings show.
