QSR Chains Serve Up Whopper of a Merger

MIAMI—Burger King Worldwide and Tim Hortons Inc. have made it official, announcing Tuesday that the Miami-based burger chain had agreed to buy the donut maker in a stock-and-cash deal worth $11.4 billion. The 60-year-old Burger King will remain headquartered in Miami, although the holding company for both brands will be based in Canada, where Tim Hortons is located.

Although the bulk of the financing for the acquisition will come from a $9.5-billion debt financing package led by JP Morgan and Wells Fargo, Warren Buffet‘s Berkshire Hathaway is committing $3 billion of preferred equity. Berkshire will only be a funding source and will play no role in management or operations of the new company, which among other things will seek to roll out the Tim Hortons format, largely concentrated in Canada, to a global customer base. The two brands will be managed independently.