Burger King sold to 3G Capital for $3.26 billion

By on Sep 3, 2010 in Business, United States, World Comments

Burger King was sold to 3G Capital, a private equity firm, for $3.26 billion (£2.1billion).

The said transaction is expected to close in the third quarter of this year, 2010.

Burger King, US second largest hamburger chain (next to McDonald’s), has struggled during the recession and last week forecast weak demand for the rest of the year.

At the end of fiscal year 2009, Burger King reported that it has 12,100 outlets in 73 countries; while 66% are in the United States, and 90% are privately owned and operated.

The company has more than 37,000 employees serving approximately 11.4 million customers daily, according to Wikipedia.

In 2006, Burger King floated on Wall Street, four years after being bought by a group of private equity firms.

TPG Capital LP, Goldman Sachs Capital Partners and Bain Capital Investors collectively own about 31 per cent of Burger King‘s shares and will tender their shares into the offer, which is due to begin by Sept. 17.

The current deal, worth $24 a share, comes after Burger King‘s stock price surged more than 15% on Wednesday and opened on Thursday up 23% at $23.25.

In a statement, the companies said that the deal represented a 46% premium to Burger King‘s share price before news of a possible takeover surface.

Under the terms of the deal with 3G, Burger King‘s chairman and chief executive John Chidsey will become co-chairman of the board.

Alex Behring, managing partner of US-based 3G, will be the other co-chairman.

Last week, the company forecast weak demand during its new fiscal year due to the US economy’s slow pace of recovery and government austerity programs in several European countries.

3G will also take on Burger King‘s debt, valuing the deal at $4 billion in total.

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