Oakville, Canada-based Restaurant Brands International Inc. (RBI) (NYSE/TSX: QSR, TSX: QSP), owner of the renowned Burger King and Tim Hortons quick service restaurant brands, said it agreed to acquire Atlanta, Georgia-based Popeyes Louisiana Kitchen Inc. (NASDAQ: PLKI) for $79.00 per share in cash, or $1.8 billion.
Restaurant Brands is one of the world’s largest quick service restaurant companies with more than $24 billion in system sales and over 20,000 restaurants.
Founded in New Orleans in 1972, Popeyes is the franchisor and operator of Popeyes restaurants, one of the world’s largest quick service restaurant chicken concepts with over 2,600 restaurants in the U.S. and 25 other countries. Its global footprint will complement RBI’s existing portfolio of over 20,000 restaurants in more than 100 countries and U.S. territories.
Following the closing, Popeyes will continue to be managed independently in the U.S., while benefiting from the global scale and resources of RBI. Building on the momentum of recent years, RBI plans to continue developing the brand at an increasing pace in the U.S. and international markets in the years to come.
“Popeyes is a powerful brand with a rich Louisiana heritage that resonates with guests around the world,” said Daniel Schwartz, Chief Executive Officer of RBI. “With this transaction, RBI is adding a brand that has a distinctive position within a compelling segment and strong U.S. and international prospects for growth. As Popeyes becomes part of the RBI family we believe we can deliver growth and opportunities for all of our stakeholders including our valued employees and franchisees. We look forward to taking an already very strong brand and accelerating its pace of growth and opening new restaurants in the U.S. and around the world.”
Cheryl Bachelder, Chief Executive Officer of Popeyes, said, “I am proud of the superior results the Popeyes team has delivered in recent years; they have served all stakeholders well. As Popeyes enters its 45th year, its success reflects the amazing brand entrusted to us by founder Al Copeland, Sr. and the unique high trust partnership that we enjoy with our franchise owners. RBI has observed our success and seen the opportunity for exceptional future unit growth in the U.S. and around the world. The result is a transaction that delivers immediate and certain value to the Popeyes shareholders.”
The acquisition price represents a premium of 27% based on Popeyes’ 30-trading day volume weighted average price as of February 10, the last trading day before media speculation on the potential sale of Popeyes.
RBI will finance the deal with cash on hand and a financing commitment from J.P. Morgan and Wells Fargo.
The deal is subject to customary closing conditions and is expected to close by early April 2017.
RBI was advised by Paul, Weiss, Rifkind, Wharton and Garrison LLP. Popeyes received financial advice from UBS and Genesis Capital LLC and legal counsel from King & Spalding LLP.