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Burger King is set to become a public company again

Burger King plans to relist its shares on the New York Stock Exchange within three months, part of owner 3G Capital's deal to sell a 29% stake to a London firm.

April 05, 2012|By Tiffany Hsu, Los Angeles Times

Burger King is giving the public a bit of a closer look at its reinvention strategy with its decision to trade its shares publicly again.

The hamburger giant said it would become a public company and relist its shares on the New York Stock Exchange within three months. The last time Burger King traded publicly was in 2010, when investment firm 3G Capital took it private for $3.3 billion.

In a complex $1.4-billion deal, 3G said late Tuesday that it was selling a 29% stake in the Miami fast-food chain to Justice Holdings, a London acquisition company.

As part of the transaction, Justice will reemerge as Burger King Worldwide Inc. with shares traded on the Big Board rather than on the London Stock Exchange, where Justice shares now are listed. 3G will remain the combined company's largest shareholder with a 71% stake.

"Burger King stood out as a unique global player in the expanding international quick-service restaurant industry with a strong heritage and an aggressive transformation underway in its North America business unit," said Justice co-founder Nicolas Berggruen.

Burger King Chief Executive Bernardo Hees said last year was a "pivotal year for the Burger King brand." The onetime Latin American railroad executive was brought on board as Burger King's boss in 2010.

Most of the changes, however, appear to have occurred more recently.

This year, the chain kicked out its king mascot for a broader marketing strategy. The company is rolling out a remodeling effort through its more than 12,500 stores around the world.

This week, the company revealed its largest menu shake-up ever, with the addition of garden salads, snack wraps, real fruit smoothies and frapp├ęs. Burger King also signed as spokespeople a selection of Tinseltown's biggest names, including David Beckham, Jay Leno, Salma Hayek and Steven Tyler.

Still, the company has watched a steady exodus of customers to fast-casual competitors such as Five Guys and lost its second-place spot in the U.S. burger wars to Wendy's last month. Last year, revenue dipped 3% to $2.3 billion from $2.4 billion.

As part of the deal with Justice, Burger King will get two new board members: Alan Parker, one of Justice's independent directors and a former restaurant and hotel executive, and Martin Franklin, executive chairman of consumer products company Jarden Corp.

Billionaire William A. Ackman, who runs hedge fund Pershing Square Capital Management, is also a Justice co-founder.

The boards of Justice and 3G approved the agreement, which is not subject to shareholder approval but does need to pass muster with antitrust authorities and the Securities and Exchange Commission.

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