Burger King UK owner eyes whopper with new franchise deal
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The owner of Burger King’s UK operations is in advanced talks about a new franchise deal that will cut the number of new restaurants it is obliged to open each year.
Sky News has learnt that Bridgepoint, the London-listed private equity firm, is close to striking a long-term deal with Restaurant Brands International (RBI), the US-based owner of the Burger King brand.
City sources said that under a new master franchise agreement (MFA) that would run until about 2034, the owner of Burger King UK would be required to invest in at least 20 new openings annually, rising to close to 40 over time.
A deal is likely to be announced within weeks, they added.
It follows talks between Bridgepoint and RBI in which the private equity firm is said to have expressed unhappiness about the financial returns it was seeing amid a highly inflationary cost environment.
Industry sources say that Burger King’s UK sales growth has been robust in recent months, ahead of rivals, and that its management team is confident of extending this trend.
The operation owned by Bridgepoint accounts for roughly 290 of the 600 UK Burger King sites, with the remainder owned by other franchisees.
A new MFA could help pave the way for an eventual sale or stock market flotation of the business, although neither option is thought to be imminent.
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Bridgepoint has owned Burger King UK since 2017, with the business chaired by Martin Robinson, a leisure industry veteran, and run by chief executive Alasdair Murdoch.
Like other chains, its balance sheet was hit hard by the pandemic, but it has recovered strongly since, despite concerns about consumer confidence.
Bridgepoint declined to comment, while RBI did not respond to a request for comment.
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