Burger King's $1 Billion China Franchisee Considers Hong Kong IPO
Burger King's $1 Billion China Franchisee Considers Hong Kong IPO
(Bloomberg) -- Burger King’s China franchisee is weighing a Hong Kong initial public offering after earlier scrapping plans for a U.S. share sale, people with knowledge of the matter said.
TAB Food Investments is considering a listing of the Chinese business, which runs more than 1,000 Burger King outlets in the country, as soon as early next year, according to the people. It could seek a valuation of about $1 billion for the operations, one of the people said, asking not to be identified because the information is private.
The Istanbul-based company could raise at least $200 million from the share sale, though it hasn’t set a precise fundraising target, the people said.
TAB Food has been benefiting from China’s growing middle class and consumers’ increased appetite for foreign cuisine. It competes with Yum China Holdings Inc., which manages Pizza Hut and KFC operations in the country as well as local restaurant chains such as hotpot chain Little Sheep.
A deal could help provide a boost to the Hong Kong bourse, which has seen several Chinese enterprises shy away from listings as a wave of protests hit the city this summer. Some companies are still pushing ahead, with Chinese artificial intelligence startup Megvii planning to submit a listing application as soon as this week, people with knowledge of the matter said.
No final decisions have been made, and details of the potential transaction could change, the people said.
Popeyes Rollout
“We always assess IPO possibilities,” TAB Food Chairman Erhan Kurdoglu said by phone Friday. “However, there’s no concrete development on that front as of now.”
TAB Food is the biggest franchisee for Burger King globally, managing close to 1,700 restaurants in Turkey and China, according to its website. Its China business, which started in 2012, is present in more than 150 cities.
The company said in February 2018 that it was postponing a planned U.S. IPO of its global operations, without giving a reason. TAB Food will continue to evaluate the timing for a proposed offering as market conditions develop, it said at the time.
TAB Food is also a franchisee of Popeyes Louisiana Kitchen Inc. Last month, the company signed an agreement with Popeyes to open more than 1,500 fried chicken restaurants in China for the chain over the next decade.
--With assistance from Taylan Bilgic.
To contact the reporters on this story: Vinicy Chan in Hong Kong at vchan91@bloomberg.net;Crystal Tse in Hong Kong at ctse44@bloomberg.net;Manuel Baigorri in Hong Kong at mbaigorri@bloomberg.net
To contact the editors responsible for this story: Fion Li at fli59@bloomberg.net, Ben Scent, Amy Thomson
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