Major Wendy's Franchisee Files Chapter 11 Bankruptcy
Meritage Hospitality Group, one of the largest Wendy’s franchisees in the U.S., has filed for Chapter 11 bankruptcy protection. The filing follows a dispute with Wendy’s corporate parent and is attributed to financial pressures including rising beef costs, weak customer traffic, and aggressive promotional discounting that have eroded profit margins. Meritage operates 314 Wendy's locations across 15 states and reported significant declines in performance: store-level earnings dropped by 48% in 2025, while revenue fell to $617.7 million from $669.3 million the previous year. The company also incurred a net loss of $31.5 million compared to an $8 million profit in 2024. Wendy’s had sought to terminate Meritage's franchise rights, but this was paused after the bankruptcy filing. Meritage is seeking court-supervised restructuring and has taken steps like closing underperforming locations and altering breakfast service to reduce losses by approximately $11.2 million annually in EBITDA.
Topics: bankruptcy corporate disputes fast food Wendy's franchisees