CityA.M. reports that Burger King may leave the USA in a $20bn tax inversion deal as a result of combining with Canadian coffee and doughnut chain Tim Hortons. The deal that would create a fast food empire with a market valuation of over $20bn (£12bn).
The companies only entered merger talks on Sunday, but commented that the merged group would be based in Canada, which has lower overall corporate taxes than the USA, where Burger King is based.
Shares in the two groups soared on news of the talks, with Burger King up 19.5 per cent at $32.40 in New York, while Tim Hortons closed up 19.3 per cent at $82 in Canada.
“The new company would be the world’s third-largest quick service restaurant company, with approximately $22bn in system sales and over 18,000 restaurants in 100 countries worldwide,” Burger King and Tim Hortons said in a joint statement.
3G Capital, which acquired Burger King outright in 2010 for $3.3bn before floating it in 2012, would remain majority owner.
The proposed deal would be structured as a so-called tax inversion transaction which would move Burger King’s headquarters out of the USA.