JUSH Justice Hldgs

Burger King Holdings Inc. is putting the "fast" in the fast-food business.

Less than 18 months since the struggling hamburger chain was taken private by Brazilian-backed private-equity investors, Burger King has devised a complex deal with an investment vehicle tied to hedge-fund manager Bill Ackman that would make it once again a publicly traded company.

The parties involved hope a host of changes that owner 3G Capital Management implemented in that short time--replacing top management, slashing costs and jobs, overhauling its menu and having celebrities, instead of its King mascot, hawking products in U.S. commercials --will lend enough faith to investors that the nearly 60-year-old chain has turned a corner.

"It's been around a long time, [but] it's not been particularly well-managed during the time," Ackman said Wednesday on a conference call. "That's the opportunity."

Burger King's recent history suggests caution. The company, a perennial No. 2 to top global rival McDonald's Corp. (MCD) and which now also looks up at Wendy's Co. (WEN) in the U.S., shuffled through 13 chief executives over the last quarter century. In that time it has gone from being a corporate orphan to a private equity firm's portfolio company to a publicly-traded company, with the strategy shifting along the way.

Burger King sales had also been slumping prior to 3G's 2010 buyout, particularly in the U.S., where the chain resorted to discounts that hurt profits and failed to spike interest from customers. Relations with franchisees that operate the stores were quickly deteriorating.

Ackman hopes the latest management team brought in by 3G will succeed in shepherding its strategy of creating a leaner corporate structure that focuses on managing the Burger King brand. Burger King plans to sell nearly all of the nearly 1,300 store is still owns to franchisees by the end of the year, insulating the corporation from commodity cost swings and other fixed costs that come with running restaurants.

Doing most of the talking during the conference call, Ackman laid out a strategy showing Burger King's average store sales, currently around $1.2 million, closing the gap it has with Wendy's, close to $1.5 million, and even approaching the $2.4 million generated by the average McDonald's.

An overhauled menu includes more smoothies, salads and snack wraps designed to attract a broader customer base after Burger King's previous efforts to target young men. Franchisees, Ackman said, are better suited to run stores as they know the local market better. Burger King also hopes to see 40% of its U.S. stores renovated in the next three years, with the new look attracting customers.

Burger King also wants to push further globally, targeting having 17,000 stores by 2016, up from 12,500 currently, by signing joint ventures with overseas partners.

"Really, in every place there is a McDonald's, there can be a Burger King," Ackman said. McDonald's has about 33,000 locations world-wide.

The plan is ambitious, suggesting that Burger King can, with a much leaner operating structure, rapidly increase sales while having franchisees and other partners invest the capital to do so. "If it does work, it redefines how we think about an industry, about what is possible, about what is under-earning and over-earning," UBS restaurant analyst David Palmer said on the call.

As part of the deal, Burger King will sell a 29% stake to Justice Holdings Ltd. (JUSH.LN), a U.K. listed shell company founded by Ackman and other investors including billionaire investor Nicolas Berggruen and Jarden Inc. (JAH) founder Martin Franklin. 3G will receive $1.4 billion in cash, essentially making back all the equity it put into its $4.3 billion leveraged buyout, and retain a 71% stake.

Burger King is changing its name to Burger King Worldwide Holdings Inc., and plans to be listed on the New York Stock Exchange in 60 to 90 days, while Justice Holdings will cease to exist as an independent company.

-By Paul Ziobro, Dow Jones Newswires; 212-416-2194; paul.ziobro@dowjones.com

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