Wyndham Destinations Inc. purchases Travel + Leisure publication from Meredith Corp. for $ 100 million, in a deal that would expand Wyndham’s business beyond its core vacation ownership business. In addition to its eponymous magazine, Travel + Leisure offers member-based travel services. Wyndham manages 230 timeshare resorts, with more than four million members in its lines of business. The combined company is said to have 18 resort, travel club and lifestyle travel brands. Meredith will continue to publish Travel + Leisure under a 30-year renewable license agreement, with Travel + Leisure staff remaining as Meredith employees, the companies said. Wyndham Destinations, which separated Wyndham Hotels & Resorts Inc. in 2018, plans to change its name to Travel + Leisure Co. and trade under the symbol “TNL” from mid-February. The aim of the merged company will be to expand its travel club business, offer new travel services and expand licensing agreements. .
David Gibbs just signed
Yum brand Inc.
the first restaurant acquisition in years and is planning a convention for nearly 1,000 fast food franchisees worldwide when the pandemic cripples the global economy in March.
The sudden crisis threatens to wipe out most of the $ 17 billion that companies and franchisees make in annual dinner sales at all KFC, Taco Bell and Pizza Hut restaurants in more than 150 countries. Mr. Gibbs, a 31-year Yum veteran who became CEO a year ago, went from advancing the company’s expansion strategy to competing with thousands of closed restaurants.
Since then, many large fast food companies mostly recovered from the early pandemic close, and Yum’s comparable US sales rose in the third quarter from a year ago. But Mr. Gibbs said he was rethinking how Yum – which has more than 50,000 restaurants, more than any other fast food chain – could serve and deliver more food to carry over the long term.
He’s planning a future where pre-ordering fried chicken online is routine, and Pizza Hut customers can get their orders placed in their suitcases without having to walk into the restaurant.
Meanwhile, hundreds of his US Pizza Hut locations, most of which do dine-in businesses, have permanently closed.
The 57-year-old Gibb spoke to The Wall Street Journal via video from Yum’s largely vacant office in Plano, Texas. Below is an edited excerpt.
WSJ: What mistakes did Yum make at the start of the pandemic and how do you learn from them?
Mr. Gibbs: If I look back before the pandemic, I wish we had moved faster for Pizza Hut to be more delivery, run business and less dependent on on-site dining. We’ve talked about it for years. Sometimes large organizations can become bureaucratic. But I think we may be impressed even with ourselves in how fast we’ve spun.
“ I didn’t know that normal appearance was exactly like before the pandemic. Consumers may be more aware of cleanliness in restaurants, and we are looking for new ways to provide a safe environment. ‘
WSJ: Drive-through has helped many fast food chains stay busy during a pandemic. How does that affect your development plans?
Mr. Gibbs: We’re working on a design that has multiple drive-throughs. The Australian business began building several test units with five drive-throughs in one building.
But the other part of the story is the roadside execution. You see it not only in the restaurant industry, but also in retail. This is good because of our peak drive-through constraints. No matter how hard you ride, you can still fit only X cars in a row.
WSJ: Should the front line workers get food and restaurant early access to vaccines?
Mr. Gibbs: We are very excited about this vaccine. When it’s my turn, I’ll be in line to get it. We hope all our employees get it. But we do know that there are others, such as frontline healthcare workers, who are ahead of us in the queue.
WSJ: Once a vaccine is more universally available, will you ask employees to get it or have your franchisor consider it?
Mr. Gibbs: We are studying the matter right now and haven’t made any decisions yet. It is important to remember that 98% of our stores are run by these franchisees. So it’s more complex than we just mandating that every store needs to get a vaccine.
WSJ: Even when vaccines start rolling out, it’s unclear when life will begin to return to normal. When did you anticipate this to happen in fast food?
Mr. Gibbs: I didn’t know that normal appearance was exactly like before the pandemic. Consumers may be more aware of cleanliness in restaurants, and we are looking for new ways to provide a safe environment.
WSJ: What management actions have you taken that will survive the pandemic?
Mr. Gibbs: One of the biggest lessons I learned is the power of authentic communication versus the formal written memos someone might send. We bring together various groups of franchisees, corporate teams from around the world in video calls. We get hundreds of questions via the chat function – real time, without filters. We learn from that.
WSJ: Do you support a $ 15 minimum wage at the federal level and for your employer and franchisees?
Mr. Gibbs: We support the national minimum wage, and we will work under whatever minimum wage the government makes.
WSJ: How do you expect the dynamics between the CEO and the White House to shift in the new government?
Mr. Gibbs: We are excited to work with the Biden government and share their goal of building back better especially on the economy and fighting inequality. We have been in more than a hundred countries around the world for decades – we have operated in any political environment.
WSJ: The pandemic’s theme is menu simplification, but some customers say Taco Bell went too far in removing options. Were you surprised by the commotion when Taco Bell removed Mexican Pizza?
Mr. Gibbs: I’ve never been surprised by the passion our customers – especially Taco Bell – have for our iconic products. We can always bring back the Mexican Pizza at some point if the request is there.
WSJ: What is your pandemic tranquillizer?
Mr. Gibbs: I often pass through Taco Bell drive-throughs. We introduced grilled cheese burritos during a pandemic, and that’s the definition of a product that was so coveted for me and my college son.
Write to Heather Haddon at [email protected]
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soft drink Together.
agreed in principle to sell its stake in Australian bottling to one of its European affiliates, the latest move to reduce exposure to expensive bottling operations and focus on the more lucrative concentrate manufacturing business.
The deal between Atlanta-based Coke and
PLC, which bottles and distributes Coke products in Western Europe, valued Coke’s 31% stake in Australian bottlers at about $ 1.6 billion. Coca-Cola European Partners on Monday also offered to buy the remaining 69% of the Australian company,
Coca-Cola Amatil Ltd.
Bottlers had lost their fizz in Coke for a while.
In 2017, Coke completed a series of deals in the US that shifted its bottling business there from a largely company-owned system to one run by local groups, some of which were family-owned, truck products to stores and operate production plants. A year later, Coke sold its Canadian bottling operations, including a distribution center and five soda manufacturers.
Getting rid of that asset-heavy operation means the number of Coke employees has fallen sharply in recent years, while helping to reduce its debt burden. However, Coke faced new challenges that were brought by the coronavirus crisis and have discontinued some brands, lay off some workers and change its marketing strategy.
On Monday, Coke said it would only sell its shares if the deal for Coca-Cola European Partners to acquire the remainder of Coca-Cola Amatil is implemented. Other Australian bottling shareholders, including investment funds and mom-and-pop investors, will need to vote to agree to the deal. The head of the Australian company said it plans to recommend a sale unless a winning bid emerges, adding that there is no guarantee the deal will work.
Coca-Cola European Partners is offering 12.75 Australian dollars, equivalent to $ 9.10, a share for Coca-Cola Amatil, about a 23% premium over the volume-weighted average price for the week. Australia-listed Coca-Cola Amatil rose about 16% in Monday trade, to A $ 12.50 per share.
Coke, however, agreed to sell its stake in Coca-Cola Amatil at a lower price – around A $ 10 per share. Coke may sell its shares to Coca-Cola European Partners in two or more stages over time, with several price variations.
In a statement, Coke said it supports the entire transaction, and it is in the best interests of the Coca-Cola system as a whole and shareholders in Australian and European companies. It said the deal would combine the strengths and capabilities of the two companies.
“We will open up further growth and value in their important market,” said Coke.
Coca-Cola European Partners, which says it is the world’s largest Coke bottler by revenue, said the deal would add geographic diversification and scale to the company’s footprint, which is currently focused exclusively on Western Europe. Coca-Cola Amatil sells Coke products in Australia, New Zealand, Fiji, Papua New Guinea, Samoa and Indonesia – which has a population of 270 million and is touted as a growth opportunity for Coke products.
Analysts said Monday’s deal reflects Coke’s overall strategy to limit its involvement in bottling operations, even though Coke has made a one-time investment to accelerate sales in promising markets, including putting $ 500 million into Coca-Cola Amatil’s Indonesian subsidiary about five years ago. .
“There are multiple stages in the process of making concentrate and getting it into the hands of consumers, and bottling and distributing it are two of the most capital intensive parts of the process,” Adam Fleck, regional director of equity research in Australia at Morningstar, said Monday. “They have historically relied on their bottling partners to take that capital.”
Coke still has about 19% stake in Coca-Cola European Partners.
Coca-Cola Amatil has faced many of the same challenges as bottlers in other markets. Consumers in Australia, the largest market by income, have shifted away from sugary and carbonated drinks due to health concerns, earning revenue despite the company’s efforts to diversify into distribution of coffee, energy drinks and alcohol.
Recently, sales have been hit hard by the coronavirus pandemic, particularly as people hoarded lower-margin products sold in grocery stores instead of higher-margin products in bars and restaurants, which were closed during the lockdown.
Stock brokerage firm Morgans said that Coca-Cola European Partners’ assessment of Coca-Cola Amatil was in line with other bottling deals, but it was not a “knock-out offer”. Coca-Cola Amatil could achieve higher margins in the future, mainly because it benefits from a cost-cutting program and easy lockdown for the coronavirus across the region, the company said.
Write to Mike Cherney at [email protected]
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