Restaurant Brands International Inc. (RBI) is a Canadian-based
multinational fast food
holding company
A holding company is a company whose primary business is holding a controlling interest in the securities of other companies. A holding company usually does not produce goods or services itself. Its purpose is to own shares of other companies ...
. It was formed in 2014 by the $12.5 billion merger between American fast food restaurant chain
Burger King
Burger King (BK) is an American-based multinational chain store, chain of hamburger fast food restaurants. Headquartered in Miami-Dade County, Florida, the company was founded in 1953 as Insta-Burger King, a Jacksonville, Florida–based res ...
and Canadian coffee shop and restaurant chain
Tim Hortons
Tim Hortons Inc., commonly nicknamed Tim's, or Timmie's is a Canadian multinational coffeehouse and restaurant chain. Based in Toronto, Tim Hortons serves coffee, doughnuts, and other fast-food items. It is Canada's largest quick-service rest ...
, and expanded by the 2017 purchase of American fast-food chain
Popeyes Louisiana Kitchen
Popeyes Louisiana Kitchen, Inc., also known as Popeyes and formerly named Popeyes Chicken & Biscuits and Popeyes Famous Fried Chicken & Biscuits, is an American multinational chain of fried chicken fast food restaurants that was formed in 1972 ...
. The company is the
fifth-largest operator of
fast food restaurants in the world behind
Subway
Subway, Subways, The Subway, or The Subways may refer to:
Transportation
* Subway, a term for underground rapid transit rail systems
* Subway (underpass), a type of walkway that passes underneath an obstacle
* Subway (George Bush Interconti ...
,
McDonald's
McDonald's Corporation is an American Multinational corporation, multinational fast food chain store, chain, founded in 1940 as a restaurant operated by Richard and Maurice McDonald, in San Bernardino, California, United States. They rechri ...
,
Starbucks
Starbucks Corporation is an American multinational chain of coffeehouses and roastery reserves headquartered in Seattle, Washington. It is the world's largest coffeehouse chain.
As of November 2021, the company had 33,833 stores in 80 c ...
and
Yum! Brands. RBI is based alongside Tim Hortons in
Toronto
Toronto ( ; or ) is the capital city of the Canadian province of Ontario. With a recorded population of 2,794,356 in 2021, it is the most populous city in Canada and the fourth most populous city in North America. The city is the ancho ...
(previously
Oakville, Ontario
Oakville is a town in Regional Municipality of Halton, Halton Region, Ontario, Canada. It is located on Lake Ontario between Toronto and Hamilton, Ontario, Hamilton. At its Canada 2021 Census, 2021 census population of 213,759, it is List of tow ...
). For tax purposes, Burger King and Popeyes retain their existing operations and headquarters, both in
Miami
Miami ( ), officially the City of Miami, known as "the 305", "The Magic City", and "Gateway to the Americas", is a East Coast of the United States, coastal metropolis and the County seat, county seat of Miami-Dade County, Florida, Miami-Dade C ...
. The 2014 merger focused primarily on expanding the international reach of the Tim Hortons brand and providing financial efficiencies for both companies.
3G Restaurant Brands Holdings LP, an affiliate of the Brazilian investment company
3G Capital
3G Capital is a Brazilian-American multibillion-dollar investment firm, founded in 2004 by Alex Behring, Jorge Paulo Lemann, Carlos Alberto Sicupira, Marcel Herrmann Telles and Roberto Thompson Motta.
The firm is best known for implementing zero ...
, owns a 32% stake in Restaurant Brands International.
The company is publicly traded on the
New York Stock Exchange
The New York Stock Exchange (NYSE, nicknamed "The Big Board") is an American stock exchange in the Financial District of Lower Manhattan in New York City. It is by far the world's largest stock exchange by market capitalization of its listed c ...
and the
Toronto Stock Exchange.
In January 2019, Jose Cil was named the CEO of Restaurant Brands International, and Daniel Schwartz was named the executive chairman of the company.
History
On August 24, 2014, American fast-food chain
Burger King
Burger King (BK) is an American-based multinational chain store, chain of hamburger fast food restaurants. Headquartered in Miami-Dade County, Florida, the company was founded in 1953 as Insta-Burger King, a Jacksonville, Florida–based res ...
announced that it was in negotiations to merge with the Canadian coffee shop and restaurant chain
Tim Hortons
Tim Hortons Inc., commonly nicknamed Tim's, or Timmie's is a Canadian multinational coffeehouse and restaurant chain. Based in Toronto, Tim Hortons serves coffee, doughnuts, and other fast-food items. It is Canada's largest quick-service rest ...
.
The proposed merger would involve a
tax inversion
A tax inversion or corporate tax inversion is a form of tax avoidance where a corporation restructures so that the current parent is replaced by a foreign parent, and the original parent company becomes a subsidiary of the foreign parent, thus mov ...
into Canada, with a new holding company majority-owned by Burger King's current majority-owner,
3G Capital
3G Capital is a Brazilian-American multibillion-dollar investment firm, founded in 2004 by Alex Behring, Jorge Paulo Lemann, Carlos Alberto Sicupira, Marcel Herrmann Telles and Roberto Thompson Motta.
The firm is best known for implementing zero ...
, and the remaining shares in the company held by current Burger King and Tim Hortons shareholders. A Tim Hortons representative stated that the proposed merger would allow Tim Hortons to leverage Burger King's resources for international growth; the two chains would retain separate operations post-merger.
News of the proposal caused Tim Hortons' shares to increase in value by 28 percent.
On August 25, 2014, Burger King officially confirmed its intent to acquire Tim Hortons Inc. in a deal totaling
CDN
CDN may refer to:
Places
* Canada (Canadian), a North American country
* , a neighborhood in Montreal, Quebec, Canada
Technology
* Content delivery network, on the Internet
* Change detection and notification, of Web pages
Transportation
* Can ...
$12.5 billion (US$11.4 billion).
3G Capital purchased the company at $65.50 per share, and existing shareholders received $65.50 in cash and 0.8025 shares in the new holding company: per-share—all-cash ($88.50) and all-shares (3.0879) options would also be available. Due to its iconic status in Canadian culture, CEO Marc Caira reassured the integrity of Tim Hortons following the purchase, stating that the acquisition would "enable us to move more quickly and efficiently to bring Tim Hortons' iconic Canadian brand to a new global customer base".
Although tax inversions, a process in which a company moves its headquarters to a
country
A country is a distinct part of the world, such as a state, nation, or other political entity. It may be a sovereign state or make up one part of a larger state. For example, the country of Japan is an independent, sovereign state, while the ...
with a lower
tax rate
In a tax system, the tax rate is the ratio (usually expressed as a percentage) at which a business or person is taxed. There are several methods used to present a tax rate: statutory, average, marginal, and effective. These rates can also be p ...
but maintains the majority of their operations in their previous location, had been a recent financial trend, it did not have as much of an impact on Burger King's reincorporation in Canada. The
corporate tax rate in the United States was at the time 39.1% (since then lowered to 21%), while Canada's
corporate tax rate is only 26%; however, Burger King had already used various
sheltering techniques to reduce its tax rate to 27.5%. As a high-profile instance of tax inversion, news of the merger was criticized by U.S. politicians, who felt that the move would result in a loss of tax revenue to foreign interests, and could result in further government pressure against inversions (which had, until the Burger King merger, been primarily invoked by pharmaceutical firms).
3G Capital co-founder
Alex Behring
Alexandre Behring da Costa (born 1967) is a Brazilian businessman. He is a co-founder and managing partner at 3G Capital, executive chairman of Restaurant Brands International, a director of Anheuser-Busch InBev, as well as chairman of Kraft Heinz ...
denied that the merger was tax-related, stating that it was "fundamentally about growth and creating value through accelerated expansion".
The deal was approved in Canada by the
Competition Bureau
The Competition Bureau (french: Bureau de la concurrence) is the competition regulator in Canada. It is an independent Canadian law enforcement agency that ensures that markets operate in a competitive, innovative manner.
Headed by the Comm ...
on October 28, 2014, ruling that the deal was "unlikely to result in a substantial lessening or prevention of competition".
The deal was approved by
Minister of Industry James Moore on December 4, 2014; the two companies agreed to conditions, requiring that the Burger King and Tim Hortons chains retain separate operations, not combine locations in Canada and the United States, maintain "significant employment levels" at the Oakville headquarters, and ensure that Canadians make up at least 30% of Tim Hortons' board of directors.
Tim Hortons shareholders approved the merger on December 9, 2014; the same day, it was announced that the new holding company would be known as Restaurant Brands International, and trade under the ticker symbol QSR. Vice-chairman Marc Caira felt that the merger was the "next chapter" for Tim Hortons, envisioning a "bolder, more assertive, and dynamic Tim Hortons in the future" alongside its prospects for international expansion.
Acquisitions
On February 21, 2017, RBI announced its intent to acquire
Popeyes Louisiana Kitchen
Popeyes Louisiana Kitchen, Inc., also known as Popeyes and formerly named Popeyes Chicken & Biscuits and Popeyes Famous Fried Chicken & Biscuits, is an American multinational chain of fried chicken fast food restaurants that was formed in 1972 ...
for US$1.8 billion at US$79 per share. On March 27, 2017, the deal closed with RBI purchasing Popeyes at $79 per share via Orange, Inc, an indirect subsidiary of RBI.
On November 15, 2021, RBI announced its intent to acquire
Firehouse Subs for US$1 billion. The acquisition was completed on December 15, 2021.
Finances
Ownership and leadership
3G Capital (which held a 71% majority stake in Burger King) holds a 32% stake in Restaurant Brands International.
Berkshire Hathaway, which partially funded the merger, held a 4.8% stake in the mid to late 2010s.
Previous Tim Hortons shareholders hold a sizeable share of the combined company. Until early 2019, Daniel Schwartz served as CEO of the company, with previous Tim Hortons CEO Marc Caira being vice-chairman and director. In January 2019, Jose Cil was named the CEO of Restaurant Brands International, and Schwartz was named the executive chairman of the company.
In August 2020, it was revealed that
Berkshire Hathaway had completely sold its stake in RBI.
See also
*
List of Canadian restaurant chains
Although many of the largest restaurant chains in Canada are United States, US-based (McDonald's and Yum Brands among others), some Canadian-based (owned and operated from Canada) restaurant chains are growing and have expanded into other markets ...
*
History of Burger King
The predecessor to what is now the international fast food restaurant chain Burger King was founded on July 23, 1953, in Jacksonville, Florida, as Instant Burger King. Inspired by the McDonald brothers' original store location in San Bernardino ...
References
External links
*
{{Authority control, state=expanded
2014 establishments in Ontario
Holding companies established in 2014
Canadian companies established in 2014
Restaurants established in 2014
Companies listed on the Toronto Stock Exchange
Companies listed on the New York Stock Exchange
Multinational food companies
Holding companies of Canada
Restaurant groups in Canada
S&P/TSX 60
Tax inversions