Ihop Corp. said Wednesday that it is close to selling company-owned Applebee's restaurants to franchisees in two markets as part of a restructuring following the chain's acquisition last year.
The Glendale-based restaurant company said it expects to complete the refranchising in one market in the second quarter and wants to eventually sell 475 company-owned Applebee's stores to franchisees. Applebee's is already about 70 percent franchised. The company was not specific as to which markets were being considered.
The announcement came after Chief Executive Julia Stewart said late Tuesday that Ihop will look to boost Applebee's performance by simplifying its menu, which had been criticized as too long and complicated to execute. Stewart also reaffirmed a forecast for same-store sales growth at Applebee's restaurants of between 1 percent and 2 percent for the year.
Applebee's saw a downturn in sales prior to it's acquisition by Ihop in November, but Stewart called the chains problems self-created and maintained business could improve despite the current downturn in consumer spending.
The positive forecast boosted Ihop shares 7 percent to $48.37 in trading Wednesday on the New York Stock Exchange.
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