At $24 per share, Burger King agreed to sell itself to 3G Capital Investment Firm for $ 3.26 billion which represents a 46 percent of total shares (Thomson Reuters, 2010). Telsey Advisory Group analyst Tom Forte said that the deal is the maximum Burger King can get and no one is going to bid higher. However, TPG, Bain Capital and Goldman Sachs who are the major shareholders of BK which is about 31 percent, might also buy back the remaining shares instead of selling them and gambling whether this decision is best for Burger King Inc. (The Economist Newspaper Limited, 2010).
Los Angeles Times (2010) confidently stated that “the restaurant industry is suffering as a whole and will probably remain weak for years to come”, including Burger King whose sales has declined for five consecutive quarters since spring 2009. BK market share has also declined to 13.9% from 14.3% since it first went public in 2006, compared to McDonald’s 48% in 2009.
There are some reasons that make BK left behind. The Associated Press (2010) has identified that Burger King's once-unique concept of flame-broiled burgers is not so special anymore. The high unemployment rate is also a hit for BK. Since BK’s main target is younger males range between 18 and 34 which feel the biggest impact of recession, these young people will look for the best deal and it is not what BK is offering, said Bob Goldin, an analyst at the food consulting firm Technomic Inc. (The huffington Post, Inc., 2010). Beside, McDonald has more menu varieties and is more fashionable such as offering healthy salad menu and breakfast set and McCafe compared to Burger King. Moreover, the lattes, frappes and fruit smoothies are high-profit beverage that makes McDonald looks more appealing in investors’ eyes.
