popeyes Louisiana Kitchen is being sold. A restaurant conglomeration that already owns Burger King and Tim Hortons is making the purchase. The deal will line the pockets of both the shareholders and the owners of the chain, where business will conceivably proceed as usual on Tuesday, despite the pending sale of the company.
The deal
Restaurant Brands International Inc. is purchasing the fast-food chain for $1.8 billion in cash. Part of the cash infusion will come from commitments with banks J.P. Morgan and Wells Fargo. Shareholders for Popeyes will receive $79.00 per share, a 19.5% premium in conjunction with the close of the stock market on Friday.
The Restaurant Brands corporation is actually relatively new and designed to absorb large franchises in the way it is buying Popeyes. The business formed in 2014 when Burger King purchased Tim Hortons for $11 billion. With their newest purchase, they will look to further expand their business dealings across the country.
New business opportunity
Popeyes is already one of the most popular fast food chains in the United States. The chain is famous for their Louisiana-style fried chicken and buttermilk biscuits, bringing a notion of southern comfort food to towns across the nation. There are over 1,600 locations in the United States alone, and over 2,000 across the globe.
Restaurant Brands International Inc.
will likely look to increase the global footprint of Popeyes going forward. The fact that they already own two franchises based in Canada implies they have a strong standing in the global marketplace. Additionally, the mutual ownership could create some interesting branding and marketing opportunities for each franchise.
For example, Popeyes locations could start selling Tim Hortons coffee in addition to their fountain drink options.
Or they could begin to sell the chicken fries that Burger King has made famous on their slightly off-kilter menu. The possibilities are endless for the fast food chain to see new growth under new ownership.
