When IHOP (NYSE: IHP) agreed acquire Applebee's nine months ago, Applebee's shareholders were none too pleased. Highly respected investor Sardar Biglari vocally opposed the deal, Applebee's director Burton Sack made plans to sue, and shares of IHOP rose more than Applebee's on the announcement -- a very rare occurrence.

But now things have changed as the restaurant industry has continued to weaken and shares of IHOP have lost a good chunk of their value. Applebee's competitors like Ruby Tuesday's (NYSE: RT) have plunged, and the deal is looking less well timed.

The company released its first quarter results this week and the Applebee's turnaround appears to be doing as well as could be expected given the environment -- the company saw the first quarter of positive same-store sales growth in two years. However, plans to sell and lease back some of the real estate that came with the deal has been "challenged by weakening credit market conditions." The plan to franchise more of the company-owned stores has made some progress.

In an interview with USA Today, IHOP chairman and CEO Julia A. Stewart explained her plan to revitalize Applebee's. The paper said that she wanted "better food, better ads, better atmosphere and conversion to a near-100% franchise business model from the current about 75%. She wants Applebee's again to be the friendly, neighborhood bar and grill it was."

Stewart may have overpaid for Applebee's, but that happens with almost every acquisition. In addition, the ill-timed purchase pulled IHOP out of the acquisition game right before a lot of other restaurant companies got cheaper. If Stewart can't make hay out of Applebee's, she'll have a lot of explaining to do.