Butterfield Sells Its 14 Wendy’s Restaurants to Tucson-Based Firm

Butterfield Savings & Loan Assn. said it sold the 14 Wendy’s restaurants it owns and the rights to build more Wendy’s restaurants in Southern California for $4.2 million to WCW, a Tucson-based company.

The Santa Ana-based thrift said it will sustain an unspecified loss on the sale. “Wendy’s was not selling enough hamburgers to make a profit,” said Richard Falkow, Butterfield senior vice president. Falkow said the sale is part of the company’s plan to sell units not related to its lending and real estate activities. The Wendy’s restaurants involved in the sale are all in Southern California.

Butterfield still owns or franchises 24 Love’s restaurants, and Falkow said talks with a couple of potential buyers for these restaurants are in the “pre-negotiation” stages.

Butterfield operated its Wendy’s restaurants through its Brea-based Restaurant Investment Inc. unit. However, Love’s is operated through Butterfield’s franchising unit.

WCW officials could not be reached for comment on their plans for the restaurants and the rights they acquired.

In 1982, Butterfield bought 10 Wendy’s restaurants and the rights to build in Orange, Riverside and San Bernardino counties. In August, 1985, state and federal regulators declared Butterfield insolvent, and the Federal Savings and Loan Insurance Corp. appointed Costa Mesa-based Downey Savings & Loan to manage Butterfield.

Since then, Butterfield’s headquarters building has been sold, and Butterfield itself may be placed up for sale by year-end, probably after the Love’s restaurants are sold and certain conditions set down by the FSLIC are met.

As reported, an FSLIC suit is pending alleging that Butterfield’s former owners and managers negligently operated and defrauded the company.