Corporate Law Blog

Burger King acquisition has some Canadians concerned

Business mergers and acquisitions occur all the time, but most of us usually only hear about the big ones which involve some degree of controversy. One of the more recent merger proposals that has made its way into the news is that Burger King will be acquiring the Canadian coffee-doughnut franchise Tim Hortons. Tim Hortons currently has over 3,000 stores in Canada and about 600 in the United States. Interestingly, Hortons used to be owned by the well-known Wendy’s.

The merger is expected to result in more Hortons franchises in the United States and possibly on other continents. Some Canadians have expressed concern about the merger, though, specifically that it could change the character of the beloved, home-grown company, but Burger King has said the companies are going to operating separately. So, overall, there doesn't seem to be a great deal of controversy surrounding the merger—at least nothing serious.

Mergers are not always snag-free transactions, and they can sometimes involve a lot of negotiating, waiting, and failure. In serious cases, federal regulators may initiate an investigation into a merger if it is suspected that it might violate antitrust laws. This is the case with the Comcast, Times Warner Cable merger which has been on hold in recent months over these concerns.

Businesses who are contemplating an important merger should work with an experienced attorney to help establish a solid plan to negotiate the various aspects of the deal from a legal perspective. Doing so ensures that any legal issues that come up will be promptly addressed to ensure the best outcome to the transaction.

Source: NPR, “Canadians Fret Merger With Burger King Will Change Tim Hortons,” Jay Field, August 27, 2014.