It’s a 100% done deal now. The Minister of Industry has approved the merger between Tim Hortons and Burger King and will now create “a new global quick service restaurant leader.”
According to Industry Minister James Moore, “Burger King’s application to acquire control of Tim Hortons has been approved” and “Foreign investment transactions are reviewed on their merits and the overall economic benefit for Canada.” Moore continued and noted, “Our government is pleased to see companies like Burger King investing in Canada’s economy and looking to benefit from our low taxes and open markets.”
The Industry Minister said that Burger King has agreed to the following commitments:
- to work with Tim Hortons franchisees to maintain 100 percent of existing employment levels at Tim Hortons franchises across Canada;
- to expand Tim Hortons by opening new restaurants, both in the United States and globally, at a significantly greater pace than currently planned;
- to establish the headquarters of the new company (formed by Tim Hortons and Burger King) in Oakville, Ontario, to maintain significant employment
- levels at that facility and to list the company on the TSX;
- to manage Tim Hortons as a distinct brand, without co-branding of any locations in Canada or in the United States;
- to maintain the Canadian franchisee rent and royalty structure at current levels for a five-year period;to maintain 100 percent of Tim Hortons’ current charitable work and involvement in communities across Canada; and
- to have Canadians comprise at least 50 percent of the membership of the Tim Hortons brand Board of Directors.
Each brand will continue to be managed independently, but together they will share resources and have approximately $23 billion in sales and over 18,000 restaurants in 100 countries.
Tim Hortons and Burger King have now received regulatory approval from the Hart-Scott-Rodino Act (USA), the Competition Act (Canada), the Canada Transportation Act and Industry Canada. This deal is now expected to officially close on December 12th, 2014.