Tim Hortons And Burger King To Merge

(RTTNews) - Tim Hortons Inc. (THI, THI.TO) and Burger King Worldwide Inc. (BKW) announced a definitive agreement by which the two companies will create a new global powerhouse in the quick service restaurant sector. The new global company will be based in Canada, the largest market of the combined company.

It is expected that the shares of the new parent company will be listed on the New York Stock Exchange and the Toronto Stock Exchange.

Following the closing of the transaction, each brand will be managed independently, while benefitting from global scale and reach and sharing of best practices that will come with common ownership by the new company.

As per the terms of the transaction, which has been unanimously approved by the Board of Directors of both companies, Tim Hortons shareholders will receive C$65.50 in cash and 0.8025 common shares of the new company per Tim Hortons share.

Based on Burger King's unaffected closing stock price as of August 22, 2014, this represents total value per Tim Hortons share of C$89.32 and based on Burger King's closing stock price as of August 25, 2014, this represents total value per Tim Hortons share of C$94.05.

As an alternative to the default mixed transaction consideration, each Tim Hortons shareholder will have the ability to elect to instead receive, for each Tim Hortons share held, either C$88.50 in cash; or 3.0879 common shares of the new company, in each case subject to pro ration.

At the time of closing, Alex Behring, Executive Chairman of Burger King and Managing Partner at 3G Capital, will lead the new global company as Executive Chairman and Director.

The current Tim Hortons headquarters in Oakville, Ontario will continue to be the global home of the Tim Hortons business. Burger King's current headquarters in Miami, Florida will continue to be the global home of the Burger King business.

3G Capital will retain all of its investment in Burger King by converting its roughly 70% equity stake in Burger King into equity of the new company. On a pro forma basis, 3G Capital is expected to own approximately 51% of the new company with the balance of the common shares to be held by current public shareholders of Burger King and Tim Hortons.