RBI Acquires Popeyes China and Plans to
Accelerate Growth
Co-investment alongside Cartesian Capital in Tims China
Business
TORONTO, July 1, 2024
/PRNewswire/ - Restaurant Brands International Inc. (TSX: QSR)
(NYSE: QSR) (TSX: QSP) ("RBI", "Company") announced today two
transactions in China, the
acquisition of Popeyes China, and the co-investment with Cartesian
Capital into the business of TH International Limited ("Tims
China") (NASDAQ: THCH). The two transactions reflect RBI's
confidence in China, one of the
largest QSR markets globally, and its commitment to drive growth in
the market. RBI's total amount of capital outlay will be up
to $45M for the two transactions.
RBI has agreed to acquire the Popeyes China business from Tims
China on a cash-free debt-free basis based on an enterprise value
of $15M. Following the transaction,
RBI will own and operate Popeyes China, which opened its first
restaurant in August 2023 and has 14
restaurants in Shanghai today. The
pace of restaurant growth is expected to ramp up through
investments in local teams and restaurant development. Longer-term,
RBI expects to bring on local partners to form a more traditional
master franchisee, similar to other Popeyes international
markets.
To help fuel the growth of Tims China, Cartesian Capital and RBI
agreed to invest up to $50M of
capital into the Tims China business via three-year convertible
notes, of which $40M will be issued
at closing with the balance funded over the coming 7 months,
subject to certain operational and financial conditions. Of the
total, $20M were issued to Cartesian
and up to $30M will be issued to RBI,
including $20M at close. Following
the transaction, RBI will effectively have the right to appoint two
directors to the Tims China Board and will see its equity ownership
in the business increase to up to 18%, on an as converted basis.
The RBI team will continue to work closely with the Tims China
management team and Board to drive growth in one of the fastest
growing coffee markets in the world.
"China is one of the most
compelling long-term market opportunities for both our Popeyes and
Tim Hortons brands. Popeyes China is off to a strong start and we
are excited to unlock its development potential in one of the
largest chicken QSR markets globally. Today's announcement allows
Tims China to redouble its focus on quality restaurant development
and providing Chinese consumers with our high quality Tims coffee
and food offerings," said Rafael
Odorizzi, President of Asia
Pacific.
These transactions follow the recent appointment of Patrick Siewert as Senior Advisor for
Asia-Pacific and showcase RBI's
commitment to growth in the region.
About Restaurant Brands International Inc.
Restaurant
Brands International Inc. is one of the world's largest quick
service restaurant companies with over $40
billion in annual system-wide sales and over 30,000
restaurants in more than 120 countries and territories. RBI owns
four of the world's most prominent and iconic quick service
restaurant brands – TIM HORTONS®, BURGER KING®, POPEYES®, and
FIREHOUSE SUBS®. These independently operated brands have been
serving their respective guests, franchisees and communities for
decades. Through its Restaurant Brands for Good framework, RBI is
improving sustainable outcomes related to its food, the planet, and
people and communities.
Forward-Looking Statements
This press release includes
forward-looking statements, which are often identified by the words
"may," "might," "believes," "thinks," "anticipates," "plans,"
"expects," "intends" or similar expressions and include statements
regarding (1) expectations regarding whether the full amount of
Tims China convertible notes will be purchased, (2) expectations
regarding Popeyes future success in China and ability to accelerate restaurant
growth, (3) expectations regarding the ability and timing for
bringing in a local master franchisee for Popeyes China, and (4)
expectations regarding the ability to drive growth at Tims China.
These forward-looking statements may be affected by risks and
uncertainties in the business of RBI, Popeyes China and Tims China
and market conditions, and include the following: (1) the risk that
the conditions to the additional convertible note purchases will
not be satisfied, (2) the risk that Popeyes China will not be able
to grow as quickly as expected, if at all, and (4) risks related to
competition, macro-economic factors and general risks of doing
business in China. This
information is qualified in its entirety by cautionary statements
and risk factor disclosure contained in filings made by RBI with
the U.S. Securities and Exchange Commission and the Canadian
securities regulators, including RBI's annual report on Form 10-K
for the year ended December 31, 2023.
RBI cautions readers that certain important factors may have
affected and could in the future affect actual results and could
cause actual results for subsequent periods to differ materially
from those expressed in any forward-looking statement made herein.
RBI does not undertake any obligation to update forward-looking
statements to reflect events or circumstances after the date
hereof.
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SOURCE Restaurant Brands International Inc.