Burger King looks set to return to the stock market less than two years after leaving it in a deal with Justice Holdings, the UK-listed investment vehicle founded by billionaires Nicolas Bergruen and William Ackman.
The world’s second largest hamburger chain will list in New York as part of an agreement in which 3G Capital, the private equity firm that owns the chain, agreed to sell a stake for $1.4bn (£881m) to Justice.
The co-founders of Justice and its shareholders will own a 29pc stake in Burger King following the agreement that was announced late last night in New York, leaving 3G Capital as the majority shareholder. Justice will delist in London as part of the accord.
Mr Ackman is one of Wall Street’s biggest hedge fund managers and founder of Pershing Square Capital. Mr Bergruen, who also made his fortune in the hedge fund industry, has been dubbed the ‘homeless billionaire’ because he doesn’t own a home but lives out of hotels as he travels the world in his private jet.
3G Capital, which is backed by Brazilian billionaire Jorge Paulo Lemann, took Burger King private in September 2010 for $4bn as the chain battled with a severe downturn in the US, weak sales in Europe and a resurgent McDonalds.
Mr Ackman said that profits at Burger King have increased substantially since 3G Capital took it private.
“We believe it is the right time for Burger King to be publicly traded in the US again,” said Daniel Schwartz, Burger King’s finance director.
In a move that echoes an earlier effort by its much larger rival McDonald’s, Burger King this week introduced a new, healthier menu and announced plans to spend $750m overhauling some of its 7,000 outlets in America.
Some analysts question whether the chain has left it too late to wrest market share back from McDonalds, which has reaped the benefits of revamping its restaurants and changing its menu.
The deal with Justice will see Alan Parker, the former chief executive of Whitbread and an independent director of Justice, join the board of Burger King.
Lord Myners, the former UK Treasury minister, who is chairman of Justice, said that Burger King was appealing to Justice because it provided “strong cash flows, an experienced and successful management team and significant strategic growth opportunities”.
Justice, which listed in London in February last year, set itself a target of making an acquisition by 2014.
Burger King, founded in 1953 as Insta-Burger King, was first taken public in 2006 by a group of investment firms led by TPG Capital.