Boston, MA 08/25/2014 (wallstreetpr) – Burger King Worldwide Inc (NYSE:BKW) and Tim Hortons Inc. (USA) (NYSE:THI), the two fast food chains are in negotiations with the possible acquisition of latter by the former. The two announced yesterday that Burger King’s majority owner, 3G Capital will be having majority shares in the newly combined company as well and the rest of the shares shall be owned by Burger King and Tim Hortons’ shareholders.
Terms and Conditions of the Deal
The two companies announced that both of them will continue to operate as separate entities only, but their corporate services shall be shared. The reports of negotiations between the two fast food chain giants were first disclosed by The Wall Street Journal. However, the companies have announced that it was not assured as to when the deal will be closed finally.
The New Company- How shall it be Formed?
- The combined new company will be having 18000 restaurants.
- These restaurants shall be spread widely in 100 countries.
- The overall sales of the combined company are expected to zero in at $22 billion.
- Burger King Worldwide Inc (NYSE:BKW) and Tim Hortons Inc. (USA) (NYSE:THI) said that the combined company shall be taken over to the level of third largest fast food restaurant of the world.
Tax Inversion and Obama
Various acquisitions and mergers have been recently been in the pipeline because of tax inversion. However, Obama administration and several other authorities might take up vital steps to curtail inversion. One of the most crucial inversion deals was announced in July between AbbVie Inc (NYSE:ABBV) and Britain’s Shire, which was worth $54.7 billion. This allowed AbbVie to cut down its tax rate to around 13% in next two years from 26% at present.
However tax inversion curtailment has gained momentum in the U.S. with rising numbers of mergers and acquisitions deals already done or in the pipeline.
