Burger King Agrees To Private Investor Buyout

Burger King, (financially) depressed after grappling with the economic downturn and constant scrapping with McDonald’s, is going private. The Home of The Whopper loudly sighed today and agreed to an offer by private-investment firm 3G Capital Management for $24 a share. What went wrong?

WSJ writes, “Franchisees and analysts blame the chain’s problems on scant menu development, flawed pricing and an overworked strategy of focusing on so-called super fans, people aged 18 to 34 years old who account for half of all visits to Burger King outlets but have been disproportionately hurt by the economic slump.”

I can no afford to has cheezburger?

Burger King Agrees to 3G Capital Offer [WSJ] (Thanks to GitEmSteveDave!)

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  1. chaesar says:

    or maybe its because the “King” mascot they dumped millions into creating and promoting looks like a walking rape nightmare

    • Darrone says:

      He is part of the advertising campaign designed to entice super fans. Same with their “were going to give you 2 huge sandwiches for 4 bucks everyday”, Instead of normal advertising like value meals.

    • raydee wandered off on a tangent and got lost says:

      He is no more and no less creepy than Ronald. Clowns. Shiver.

    • Hoboman725 says:

      the king is fantastic I don’t understand any of the hate this guy gets. He’s just a plain funny character.

      Besides, when was the last time burger king had anything memorable? Only thing I can think of was when they had Mr potato head in a few commercials back in the 90s

    • Miss Dev (The Beer Sherpa) says:

      I will never be able to forget the commercial where the guy works up and *bang* then next to him is The King with a burger. “Hey, sorry I broke in and replaced your wife and all. But here’s a greasy sandwich to make up for it.” Mmmm… sandwich…

    • Mr.Grieves says:

      Don’t you bad mouth the King! Best thing to happen to advertising in years!

    • jaredwilliams says:

      haha it’s true he is creepy as hell, but it’s still really funny.

    • thewriteguy says:

      If it weren’t for the BK King campaign, I doubt that I myself would have a positive association with the chain. In my area, they tend to be located in the sketchy, economically depressed neighborhoods.

  2. El Matarife says:

    Wait, scant menu development? McDonald’s has had the same damn menu going on 100 years now. BK tried to change things up all the time.

    • parliboy says:

      Burger King’s additional menu 0selections, while tasty, did little to expand into different demographics. As a result, they kept selling to the same people (and a shrinking audience of those) instead of new people.

    • Southern says:

      Not sure how you can say that, McDonalds has come out with dozens of new menu items over the past 10 years..

      Snack Wraps (like 7 or 8 different kinds)
      Chicken Sandwiches (Chick-Fil-A Style, 6 different kinds)
      Premium Chicken Breast Strips (Whataburger/Sonic style)
      All their new beverages, McCafe’s, Coffees, Mochas, Fruit Smoothies..
      All their new premium salads.. (like 6 or 7 of those)

      They’re added quite a bit of stuff to their menu over the last ~10 years..

      Now what has BK added?

      The Steakhouse burgers (3 of them)
      3 new (cripsy) chicken sandwiches
      2 new chicken salads.
      1 new coffee (Mocha Joe). Just 1!

      Did I miss anything? They have no chicken strips, they have no expanded beverage selection, they have no salads to speak of, they have pretty much the same sandwiches they’ve had for 50 years (aside from the Steahouse burgers, which are just oversized Whoppers)..

      *Shrug*.. As far as adding menu items, I think Ronald has added a lot more than the King has. (Not really a fan of EITHER place tho, although I do love McDonalds coffees..)

      • myCatCracksMeUp says:

        (OT) – And man, McDonalds chick-fil-a sytle sandwich – the “Country Chicken Sandwich” is really good. I generally don’t eat fast food, but got one of those while on a trip and my original lunch plans failed and McDonalds was my only choice. That sandwich was good. I get fast food so seldom that it’s likely that sandwich won’t be available the next time I want it.

      • RvLeshrac says:

        BK has about 6 Steakhouse burgers, of varying types, has a Promo whopper every few months, and has embraced Coke’s touchscreen fountain, which adds more drink choices than items on both McD and BK menus *combined*.

        They also had the rib promotion for summer, the only problem with them being that they sold out everywhere faster than the company had planned on in their wildest estimates.

        The biggest issue Burger King has is that they don’t have nearly enough restaurants, mainly due to horrible franchisees who couldn’t run businesses if their lives depended on it. The location I worked at in high school, now closed, was operated by Buckeye Foods. The manager I had there was transferred from another Buckeye store in another state. Why? Because he stole *tens of thousands of dollars* from them. Rather than fire him and have him jailed, they dropped his pay and had him run another store. Where he was *again stealing money from them*.

    • tsukiotoshi says:

      They just added those smoothies and snack wraps. Let me tell you, that wildberry smoothie is excessively delicious.

    • Mr. Pottersquash says:

      Bk took away the BK KIng, brought in BK Stacker and then forgot about it. and has been reactionery to McD’s at every step.

  3. ShruggingGalt says:

    Maybe also because they paid too much for the rights to the Twilight series?

  4. dolemite says:

    I like BK, but my issues are:
    Fries. They suck. Wendies, McDonalds and Arbies are better.
    The amount of food you get for the calories seems off. Like 1 little chicken sandwhich is 800+ calories, and you aren’t even really full afterwards.

    • pecan 3.14159265 says:

      McDonalds fries are great, but Wendy’s never salts its fries, which make them taste bland me. Chick-Fil-A doesn’t salt its fries either, but I prefer the waffle fries unsalted.

      • Southern says:

        Woah.. We must not go to the same Wendy’s then, because the Wendy’s here puts a TON of sale on their fries.. I’m talkin POUNDS of the stuff. ;-) Well, ok, maybe that’s a bit of an exaggeration — but needing extra salt is definitely not something you have to ask for at my local Wendys. :-)

        I actually like ‘em that way. I prefer Wendy’s fries over McDonalds, because they ARE salter AND they’re thicker. Never really been a fan of shoestring fries.

    • mandy_Reeves says:

      and don’t forget the cruel joke of Apple Fries….apples sliced into stick form….boy was I peed off. I was expecting fritter like things.

    • GrlRedBalloon says:

      McDonald’s and Burger King fries are very similar. Wendy’s are disgusting. They’re not salted enough, and they’re too potatoey. (That’s why I think it’s funny that you like McD’s and Wendy’s, because their fries are total opposites!) But this is all a matter of opinion.

      And really? The amount of food you get for calories should seem “off” at every fast food restaurant on the map. It’s crap food that doesn’t feel you up because it’s a huge amount of calories for very few nutrients. So that’s not a BK problem, that’s an every restaurant problem.

      • mandy_Reeves says:

        you have never dipped your fries in a frosty I presume? Otherwise you would not bastardize the good name of a Wendy’s french fry. french fry/frosty dipping is a taste-gasm that few other combos can live up to.

    • mac-phisto says:

      100% agree on the fries. burger king fries used to be awesome before they changed them back around ’99. they’ve been a suckfest ever since.

    • Starfury says:

      Have to agree on the fries they’re terrible. We’ve also cut back on our fast food eating but Jack in the Box is first, McD second and Carl’s third.

    • jaredwilliams says:

      most people think that BK’s fries are best. I think so and lots of times this debate has come up thats what people say.

  5. Bativac says:

    “Franchisees and analysts blame the chain’s problems on scant menu development, flawed pricing and an overworked strategy of focusing on so-called super fans, people aged 18 to 34 years old who account for half of all visits to Burger King outlets but have been disproportionately hurt by the economic slump.”

    They forgot to mention the “terrible food and terrible service.”

    I actually thought some of their commercials were kinda funny. I loved the Subservient Chicken. But none of that stuff does any good if the food sucks and the service also sucks.

    • dg says:

      Yeah, food definitely sucks. I used to be able to tolerate it, then they changed the recipe or some ingredient and I couldn’t get within 10 feet of their onion rings w/o feeling the effects for days afterwards… those unlucky enough to be around me had to carry methane detectors…

      The service was total crap too – the people behind the counter were slow as molasses on a cold winter day, and waiting for that kind of food just wasn’t worth it.

      How about this for a concept? Make food with good ingredients that tastes good. Make it fast. Charge a fair price. Give SUPERB service always. Customers will come. Just look at In ‘n Out Burger….

  6. AllanG54 says:

    Nothing went wrong for the shareholders. They’re getting about $9 more a share than they were worth two weeks ago. It’s the highest price since they went public. If someone wants to take them private then that only proves that it’s a good brand and will be profitable. Otherwise, they’d just let them rot.

    • Griking says:

      I agree. Why is it a bad thing for BK to be a private company? It seems like it would be a good thing to no longer have to worry about kissing stock holders asses.

  7. Southern says:

    Well, all I can say is why *I* never eat there — their food (at least in MY opinion) sucked.

    The only good sandwich they have is the Whopper.

    Their fries are horrible, taste almost like their battered (and fried).
    Their onion rings are terrible.
    Just about all their other sandwiches taste like cardboard (again, in MY opinion).

    Although I will admit, their BREAKFAST menu I like. I much prefer their croissants over anyone else’s biscuit sandwiches, but I so seldom eat breakfast..

    • kethryvis says:

      The fries are terrible. My friends and i say they have “onion flavored ring shapes,” not actual onion rings.

      But to me, the crowning glory of why i do NOT ever eat at BK is…

      They microwave the burgers so the cheese melts. Have you ever microwaved bread? It’s okay for about 10 seconds after you get it out. Then it gets gummy. Then it gets hard. Gross. If i find myself where i can only get to a BK, i get the chicken thingies which sucks because i do like the flame-broiled burgers. i just wish they wouldn’t throw it in the microwave.

    • GuyGuidoEyesSteveDaveâ„¢ says:

      So wait, if you never eat there, how can you comment on their food?

      • Southern says:

        Your right Steve, I shouldn’t have said “never”.. Maybe “hated to” would be a better way of putting it.

        When I worked in one particular building downtown, there was a BK across the street – and unfortunately, they were the only (fast food) restaurant open after about 2pm.. everything else downtown pretty much closes up right after the lunch hour.. So if I had a late lunch, it was “BK or Nothing” (and many times I just decided to go with “nothing”, believe you me).. But every now and then I’d brave my distaste for the place and grab SOMETHING just to last me until I got off work between 7-8pm or so.

        I had to be pretty darn hungry though. :-)

  8. Dragon Tiger says:

    In the Baltimore/DC area, they’re relatively expensive compared to other fast food options. Heck, even Boston Market’s less than a buck more expensive than most of their BK’s combos.

  9. Rask says:

    I’ve got a craving for a Whopper with Bacon and Cheese all of a sudden…

  10. Hoss says:

    Hurt by the economic slump? So when times are good, people eat fast food?

    They tried to hard to make up an issue that isn’t reality. The issue probably lies in that they cut back on ad dollars and lost market share.

    • mmmsoap says:

      When times are bad, those who used to go to TGIFriday’s go to McDonald’s or Burger King instead. But when times are bad, those who used to go to BK eat ramen :(

      • mandy_Reeves says:

        true dat! actually, Taco Bell is your best bet. 2 dollars gets you a bag of doritos a medium soda and either a beef or chicken burrito(which you can get fresco style if ya want) or two tacos. something like that. Its on their value menu or something.

        It’s not as advertised as it was, but it does still exist. And the why pay more menu is pretty dam good too!

  11. CaptCynic says:

    Bad Food.
    Bad Service.
    Bad Advertising.

    That’s the trifecta of failure.

    • Disoriented says:

      So that’s what the BBB stands for….

    • Cleo256 says:

      Bad service is right. It’s the bad service that has driven me away from Burger King in the last 5 years. I’ve been to several in my region and elsewhere, and the bad service is a universal constant. Any chain can have a couple bad seeds here and there, but the bad service is so universal, it has to be a corporate failing.

      So yeah, universal bad service + unappealing advertising + a product that’s certainly no better than the competition = customers always choosing any other restaurant.

  12. err says:

    I can no afford to has cheezburger?

    What’s up with that? Not cool.

    Just to contribute, I do prefer Burger King over McDonald’s but prefer Wendy’s over Burger King. True, the fries at McD’s are probably the best.

  13. grayflannelsuit says:

    I’ve no reason to doubt the many here who say they think BK’s food stinks, but it doesn’t really address why their fortunes have turned south. After all, McDonald’s is doing OK and it’s not like they’re a mecca of fine dining.

    • mianne prays her parents outlive the TSA says:

      Some thoughts on why McDs seems to be doing okay, where BK isn’t.

      Appealing to many demographics. You’ve got the cheap basics ($1 menu) the premium offerings (Angus burgers, salads) basic or fancy coffee. Heck, they even have two grades of breaded chicken pieces to choose from. Best BK can seem to do is occasionally offer the same burger with different condiments, never more daring than mushroom & swiss though.

      Advertising to many many different demographic groups: women, couples, kids, parents, business folk, etc. Furthermore many of these groups are then targeted specifically by ethnicity. BK seems to have bet the entire farm on the 15-25 year old white male demographic.

      Free WiFi vs not.

      • mianne prays her parents outlive the TSA says:

        Actually reflecting on this a bit more, a more interesting comparison is BK vs. Taco Bell. Both seem to primarily cater to young white men, and have rather limited core menus.

        TB has taken some interesting steps though in broadening its appeal with the Fresca menu, Fruitista drinks, And always seem to be offering several different limited offerings to lure in the curious.

        Despite all that, TB still is rather unapologetic with its main thrust toward young men. But taking that into consideration, they are typically open much later than most non-24 hour fast food places,

        They offer an extensive “value” menu to cater to those scraping change from seat cushions. Whereas most other places, BK & McDs included, are limited to a couple burgers, fries, maybe a chicken sandwich, and soft drinks.

        • Powerlurker says:

          Taco Bell has known for years that their primary audience is those looking for the most calories for the lowest price and their entire system is based around filling this demand. They train their staff to be able to make a plain taco within 2.7 seconds, and their value items can actually make them money, unlike BK where franchises sell those $1 doubles at a loss.

    • smartmuffin says:

      As was said earlier, I don’t necessarily see how accepting a private buyout means that things are so awful.

      If someone came up to you and offered to buy your car for 15% more than its current market value, would you say no? Would you consider that offer as reflecting positivley or negativley on your car?

  14. theycallmeGinger says:

    I haven’t been to a Burger King that didn’t seem run-down or just simply unkempt. I don’t mind BK food if I’m going the fast-food route anyway, but they always seem so shabby.

    • Hobz says:

      Agreed, at least in my area.

    • Southern says:

      I’ve seen some clean ones, and I’ve seen some dirty ones.. I think that just has to matter on Employee Satisfaction in how well they like their job (which determines how good of a job they do).

      Well, that and MOST BKs that I’ve seen are usually in older buildings; I haven’t seen a NEW Burger King store built in Houston…. ever? Yeah, ever, now that I think about it. McDonalds builds new stores or RE-builds their existing ones quite often though.

    • zandar says:

      amen, they seem to hold out and hold out on renovations. Most BKs I go to are dirty and smell bad. This is why I hardly ever go to one.

  15. Murph1908 says:

    Burger King fries suck.

    But when I am looking for a fast food breakfast, BK is #1.

    • Alessar says:

      Oh yeah! They’re the ones with fries that taste like they were boiled in floor wax; synthetically crispy but taste like linoleum.

  16. whitecat says:

    By “people aged 18 to 34 years old” they mean “young white men.” Burger King routinely runs sexist, racist, inappropriate ads to target this one specific demographic, so it should be no surprise that others choose not to eat there.

    • 99 1/2 Days says:

      Can you elaborate? I don’t recall racism.

    • JWBrockman says:

      That’s a good point, they only ever seem to feature white celebrities, such as P. Diddy, Shaquille O’neal, Erik Estrada and Darius Rucker in their advertising.

  17. OneBigPear says:

    Terrible, terrible marketing. The King was creepy as all hell.

  18. zandar says:

    the king scares the hell out of my kids. Honestly. i think it’s the unthinking smile of the opaque mask, behind which could be a demon licking his lips thinking of tasty children.

    I think there’s nothing funny about the king personally. it’s lame.

    And their food is only so-so, by fast food burger standards. the croissanwich is too plain old white bready. slap a real croissant on there, then we can talk again.

  19. Alessar says:

    When I was a little kid, the Burger King was played by a nice-looking live actor who looked like he just escaped from the Ren Fair, and he did magic tricks. It was not the Terror of the Autons plastic mascot we have today!

    A year or so ago I read about Burger King pushing to revoke a 10 cent per basket premium paid to migrant workers in Florida who picked tomatoes. I decided I didn’t want their food if they were going to be that cheap.

  20. d0x360 says:

    I havent gone to BK ever since they changed their fries. I cant stand them. I like the burgers better than McDonalds but i refuse to suffer through those damn fries.

  21. plumbob says:

    Their fires and onion rings are abborhent

  22. consumerfan says:

    BK is the only fast food chain I’ll eat at – no Wendy’s, no DQ, no White Castle and definitely no KFC, McDonalds or Arbies. And BK sucks. Most of their sandwiches are awful, their fries are pathetic and their Coke tastes like dirty sugar-water.

    If it weren’t for the Whopper and their drive-through, I wouldn’t eat there at all.

    Perhaps people are learning that you can get better food, cheaper, elsewhere?

  23. sopmodm14 says:

    never really seen any franchises close down

    the private buyer should have experience with fast food chains, otherwise, they’re just run the brand into the ground

  24. sopmodm14 says:

    at my college, BK is the best there is, and there’s a mcd’s, subway, sbarro’s (now La Rosa) and wendy’s all in the same plaza, as well as off-brand franchise chinese, indian, korean and japanese

    if ii’m gonna go with fast junk food which is just a decent burger and fries craving, i hit up the BK for sure

  25. Joedel263 says:

    Going on three years since I’ve been in a Burger King.. They do have really good breakfast.. but they just don’t care..

  26. FrankReality says:

    As somewhat knowledgeable from the franchisee side, Burger King treated their franchisees very poorly. There’s a lot of friction between franchisees and BK corporate.

    The king may be cool to one demographic, but he was a big turnoff to most people and outright scary to children. You either love him or you hate him and most hate him.

    Burger King never had been able to deliver consistent quality of their food relative to their competition.

  27. JWBrockman says:

    That’s a good point, they only ever seem to feature white celebrities, such as P. Diddy, Shaquille O’neal, Erik Estrada and Darius Rucker in their advertising.