Tim Hortons, the Wendy's International subsidiary, has announced a joint venture with the owner of Cuisine de France, the Irish-based IAWS Group to build a state-of-the-art bakery in Ontario, Canada.

The 50/50 joint venture, which will cost an initial US$75m, will produce and distribute par-baked goods to the Tim Hortons restaurant chain in North America and to Cuisine de France outlets in the United States.

As additional baking capacity is needed and more production lines are added, the total joint venture investment could reach US$ 225m, split between Wendy's and IAWS.

Wendy's said it expects the venture to enhance its earnings beginning in 2003. It is expected to generate positive operating cash flow and return on capital superior to the company's 11.9% ROIC reported for 2000.

While there will be investment spending for Wendy's in 2001 and 2002, the Company expects the impact to be no more than $0.01 per share in each year.