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Dealbook: PE plays exit Burger King

SAN FRANCISCO - AUGUST 21:  A Burger King Whop...

Yes, The 12,000 restaurant chain worth a $2.2 billion yet, has been owned by Pe investors from Bain, TPG and Goldman Sachs when it was worth a no frills $1.5 billion. The gobbling up has apparently been worth it for the investors, with Bain having sold 5.82 million shares earlier before the 2008 drama begot you and me,. Bain’s stake was nearly 15% at that time.

After this round of sale, GS and TPG with Bain, would still hold 32% of the Whopper deal company and make enough on the $300 million equity component. The rest of the $1.2 billion purchase price in 2002 was Diageo debt. Though the trio got its burgers from a ‘fire side barbecue’ the firms are still selling out when Burger king equity is worth $2.2 billion. Not  a whole lot but 7 times their investment. The original deal proposed Buying  Burger King for $2.6 billion in 2002 itself but then Diageo lost some steam and the deal was renegotiated to 5 times then EBITDA (incl debt.)

Burger King restaurant at 1605 US Highway 70 E...

3i is supposed to be picking up the chain equity. It’s other interests being Indian Infrastructure with $3 billion in Infra plays in the region, this will be one of a kind play for 3 i in the lifestyle space. ET Now picked up the deal rumors in India while Bznotes played the 2002 deal back. the GS capital artners site also boasts about Alltel, TXU, Biomet and Sungard while Bain has played Warner Music, Burlington and a few other select brands. Burger King would f course like to think 3i is a good cook!

UK-based 3i is an obvious possible partner for Burger King, having helped turn around other well known brands that had fallen on hard times including the Early Learning Centre, Ben Sherman and outdoor and camping gear retailer Millets. Its current portfolio includes Hobbs and Agent Provocateur, but its own major food chain is Mongolian hot pot chain Little Sheep.

The low valuation of many publicly quoted businesses, as a result of the ongoing volatility in global financial markets, has produced a flurry of deal-making in recent weeks.(Guardian) Dy negy went to Blackstone for a low $543 million equity and another $4.16 billion in debt

2 comments on “Dealbook: PE plays exit Burger King

  1. Pingback: Tweets that mention Dealbook: PE plays exit Burger King | The Banking and Strategy Initiative --

  2. Top Portable Grill
    September 23, 2010

    A very great article. Well done. Very motivating!! Go on that way


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This entry was posted on September 1, 2010 by in Amitonomics, Financial Markets, Private Equity.


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