BURGER King will flip back to the public markets less than two years after it was snapped up by a US private equity house.
The world’s third-largest hamburger chain, currently owned by 3G Capital Management, has agreed to sell a 29 per cent stake to London-listed investment firm Justice Holdings for $1.4bn (£882m).
Shares in Justice will be suspended in London and Burger King Worldwide Holdings is expected to list on the New York Stock Exchange in the next two to three months. Justice is chaired by former City minister Lord Myners and backed by Nicolas Berggruen, the German-American “homeless billionaire”.
3G, which bought Burger King in September 2010 in a $3.26bn deal, will retain a 71 per cent stake in the company.
Justice co-founder Bill Ackman said Burger King stock “today is worth something in the high $17 to $18 range”, but could reach $20 using a more optimistic valuation.
It marks the latest change in ownership in the chain, which was bought by Texas Pacific Group, Bain Capital and Goldman Sachs Capital Partners ten years ago, then listed in 2006 before being taken private by 3G.
Justice said it expects Burger King’s core profits this year to be nearly double those of 2010. On Tuesday the restaurant launched an expanded menu in its biggest shake-up since it was founded in 1954.
Yesterday Myners said: “The Burger King transaction offers a number of the key features the board was looking for in a combination: strong cash flows, an experienced and successful management team, significant strategic growth opportunities and a company that would benefit from Justice’s public ownership.”
Burger King chief financial officer Daniel Schwartz said 3G is in “the very early innings of what is going to be a very long-term investment”.
“It’s the right time for Burger King to be public in the US again. Our new investor base will help us maximize the brand’s future potential going forward.”