Burger King serves up its shares for trading again

By GARETH MACKIE
Published on 21/06/2012 00:00

Shares in Burger King began trading on the New York Stock Exchange for the first time in almost two years yesterday.

The world’s second largest burger chain was taken private by investment firm 3G Capital in October 2010 in a deal that valued the business at $4 billion (£2.5bn).

In April, 3G sold a 29 per cent stake in the company for around $1.4bn to Justice Holdings, a London-listed shell company, co-founded by hedge fund veteran Bill Ackman, which floated last year with the aim of finding a suitable investment.

Under the deal, Justice has suspended trading on the London Stock Exchange and will now start the process of liquidating itself, although the company’s founders will keep a 13 per cent in Burger King for at least one year. The remaining 16 per cent of shares are available to retail investors.

Martin Franklin, another co-founder of Justice, and independent director Alan Parker – the former chief executive of British hotels and restaurant group Whitbread – have joined the Burger King board as part of the transaction.

Founded in 1954, Burger King has around 12,500 outlets worldwide, compared with 33,000 for McDonald’s. Around 90 per cent of its branches are owned and operated by independent franchisees. The group recently announced plans to open 1,000 branches in China over the next five to seven years. The company announced a net profit of $25m (£15.9m) for the first quarter, compared with a loss of $5.9m (£3.75m) a year earlier, on revenues 3.2 per cent higher at $569.9m (£362.9m).

Chief financial officer Daniel Schwartz said: “We believe it is the right time for Burger King to be publicly traded in the US. With this transaction, we are positioning the Burger King brand for long-term growth both domestically and internationally.”