Noodles & Company is looking at strategic alternatives, including a possible sale that could take it private.
The Broomfield, Colorado-based fast-casual chain said Wednesday that its board has initiated a review of strategic alternatives to explore ways to maximize shareholder value. That review will include looking at refinancing debt, as well as refranchising, but also the sale of all or part of the business.
The move comes as former CEO Drew Madsen stepped down for health reasons at the end of August. Former COO Joe Christina was named to the role of CEO and president, and he steps to the helm amid an attempted overhaul of the chain’s menu and struggles to boost flagging traffic.
Though Noodles saw some gains in the first quarter this year as a result of those menu moves, the second quarter proved more challenging, with traffic down 2.5% at company units. At the end of the second quarter, the company said it plans to shutter as many as 49 underperforming restaurants by the end of 2026.
Christina in a statement said the company has been working hard to improve the menu and the brand’s value proposition, with initiatives like the Delicious Duos, giving guests the option of smaller portions with sides for $9.95. As a result, in August, same-store sales were up 4.5%, he said.
“We believe now is the appropriate time to consider strategic options for our brand that could allow us to more effectively maximize value for our shareholders,” he said. “As the board conducts its review, our team will remain focused on executing our strategic priorities to establish Noodles & Company as the best choice for customers to satisfy their comfort food cravings.”
Noodles didn’t set a deadline for the strategic review process, saying it might not result in any particular outcome. Piper Sandler is the financial advisor for the review.
Noodles has also received at least two warnings from the U.S. Securities and Exchange Commission in recent months because its stock price had fallen below the required minimum for compliance with Nasdaq listing rules.
The company’s stock was trading near its 52-week low of 55 cents per share, closing Wednesday at 68 cents, a nearly 2% increase.
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