Papa John’s International Inc. (PZZA), the pizza restaurant chain, and Wendy’s Co. (WEN), the fast-food operator, held merger talks prior to the ouster of Papa John's former chair, John Schnatter, last week.

Citing people familiar with the matter, The Wall Street Journal reported the initial talks about a deal started before Schnatter was forced to step down from the company he founded after using a racial slur during media training. Talks between the two sides have since slowed down, the paper reported, noting the Papa John’s board was aware of the discussions. (See more: Wendy’s Releases Mixtape Throwing Shade at Rivals.)

Wendy’s Deal Talk Could Raise Eyebrows

The idea that Wendy’s would even have talks about a deal with Papa John’s could come as a surprise to investors and analysts since the firm has narrowed its focus over the past few years, unloading assets and focusing on its restaurants that compete against McDonald’s Corp. (MCD) and Burger King, reported The Wall Street Journal. Mark Kalinowski, an independent equity analyst told the paper that given the pizza market is fragmented, Wendy’s has the opportunity to gain market share, which could make a deal attractive.

Trian Fund Management has a 13% stake in Wendy’s and Trian co-founder Nelson Peltz is a non-executive chair of the company. Peltz has previously said Wendy’s should focus on its core burger business.

The Journal noted Wendy’s has had 21 quarters in a row in which same-store sales have risen in North America.  (See more: Top 4 Papa John's Shareholders.)