The BFD: Burger King owner eyes Popeyes
Restaurant Brands International (TSX: QSR), the 3G Capital-backed owner of Burger King and Tim Hortons, has approached Popeyes Louisiana Kitchen (Nasdaq: PLKI) about a takeover, according to Reuters. Popeyes shares climbed 14% on the news yesterday, giving it a market cap of around $1.6 billion. Shares today are sinking, however, after a late-night NY Post suggestion that the Reuters info is out of date, and that RBI lost interest in Popeyes late last year.
• Why it's the BFD: RBI's approach suggests that it is seeking to expand its U.S. presence by purchasing new assets that don't compete too directly with Burger King or Tim Hortons (from a menu perspective). Even if Popeyes isn't the ultimate target, that doesn't mean that some other billion dollar-plus chain won't get gobbled up.
• Bottom line: The best way to gauge the likelihood of this deal happening is probably to stake out a pair of Popeyes stores on Dodge St. and West Broadway St. in Omaha, Nebraska. Those are the ones closest to Warren Buffett's office and, whenever 3G Capital is involved in buying something , the fast food-loving Oracle is almost certain to have a hand in it.