Expand / Collapse search
Watch TV
Menu

This material may not be published, broadcast, rewritten, or redistributed. ©2024 FOX News Network, LLC. All rights reserved. Quotes displayed in real-time or delayed by at least 15 minutes. Market data provided by Factset. Powered and implemented by FactSet Digital Solutions. Legal Statement. Mutual Fund and ETF data provided by Refinitiv Lipper.

story

Burger King to Sell Up to 25M Shares in IPO

By Reuters
Published | Updated

LOS ANGELES – Hamburger chain Burger King Holdings Inc. on Tuesday said it expects to raise as much as $425 million through the sale of up to 25 million shares in an initial public offering later this year.

In a regulatory filing, the privately held company said it expects the shares to price between $15 and $17 a share; at the midpoint of $16, the offering would value the company at a total of about $2.1 billion.

The second-biggest burger chain behind McDonald's Corp. (MCD) has applied for New York Stock Exchange listing under the symbol "BKC".

Burger King's planned offering comes at a time of heightened investor appetite for restaurant IPOs. Earlier this year, shares of both Canadian coffee shop chain Tim Hortons Inc. (THI) and Mexican-style chain Chipotle Mexican Grill (CMG) soared in their public debuts.

One analyst said he expected Burger King shares to attract investor interest due to its strong brand recognition. He resisted comparing the offering with those of Tim Hortons or Chipotle, however, because those chains are much smaller and are growing faster than Burger King.

"I think there's going to be demand, but I wouldn't say it's strong," said David Menlow, president of IPOFinancial.com, an independent research firm based in Millburn, New Jersey. "We're not talking about a runaway."

Private equity firms Texas Pacific Group, Bain Capital and Goldman Sachs Group Inc. affiliate Goldman Sachs Capital Partners bought Burger King from British drinks company Diageo Plc in 2002 for about $1.5 billion.

Since then, the chain has revitalized sales at its more than 11,000 restaurants with new menu items like the Angus burger, enhanced breakfast offerings and a quirky advertising campaign aimed at young male consumers.

Burger King earned $37 million on revenue of $1.5 billion in the nine months ended March 31, compared with earnings of $45 million on revenue of $1.4 billion for the same period a year earlier, according to the prospectus.

Last month, Burger King promoted President and Chief Financial Officer John Chidsey to the post of chief executive in a move it said would add stability ahead of the IPO.

The offering is expected to be lead by investment banks including JPMorgan; Citigroup; Goldman, Sachs & Co.; and Morgan Stanley, the filing said.