Burger King eyes marriage with Tim Hortons

Shares in fast-food behemoth Burger King and Canadian coffee and doughnut chain Tim Hortons rose yesterday after news that they are in merger talks.

Burger King eyes tie-up with popular coffee products. Picture: AP

The companies, which are similar in market size, confirmed they were discussing a takeover of Tim Hortons by Burger King. The new entity would be based in Canada, which has a lower corporate tax rate than the US.

Miller Tabak analyst Stephen Anderson said he did not expect any competition hurdles as the firms serve different rapid-service segments. However, he warned that the proposed deal could face a backlash on both sides of the border.

In Canada, critics are likely to be unhappy that the well-known Tim Hortons brand would once again fall into foreign hands, while US-based opponents are likely to attack Burger King’s plan to domicile in Canada to cut its tax burden.

A tie-up would give the burger giant access to popular coffee products that it could add to its 7,400-plus restaurants across North America, along with a doughnut and coffee chain brand that is growing in the US.