Owner of Burger King to Buy One of the Largest Franchises for $1 Billion

CNBC claims that Restaurant Brands International will pay $1 billion to buy Burger King's largest U.S. franchisee, Carrols Restaurant Group.

This purchase comes a year after Restaurant Brands announced its $400 million plan to turn around Burger King in the U.S.

Burger King is having to compete with Wendy's, which “overtook it as the second-largest burger chain by U.S. sales.” 

 This comeback approach entails revitalizing the restaurant and increasing advertising to enhance demand and franchisee earnings.

Tom Curtis, president of Burger King U.S. and Canada, says Restaurant Brands plans to renovate 600 Carrols' Burger King sites in five years and sell them to franchisees.

Restaurant Brands will pay $9.55 per share for Carrols, which owns over 1,000 Burger King and 60 Popeyes restaurants.

Carrols' stock closed Friday at $8.42, worth $459 million, and rose over 12% in pre-market trading after the news surfaced on Tuesday.

To finance the refurbishments, Carrols will use its operational cash flow to allocate $500 million.