In an effort to keep pace with McDonald’s, American fast food chain, Burger King, has decided to purchase Canada’s favorite coffee shop, Tim Horton’s. The move was finalized early Tuesday for a total sale price of $11.4 billion.
The new corporate headquarters for the fast food giant will be relocated to Canada in an effort to relieve corporate taxes faced in the U.S., which comes under heavy criticism due to loss of revenue for the U.S. government.
The purchase will create the world’s third largest fast food company with approximately $23 billion in sales annually and more than 18,000 locations. Despite this huge acquisition, the chains will operate independently of each other.
Canada’s biggest seller of coffee and doughnuts, Tim Hortons has a cult following that could help boost breakfast sales for Burger King and could also get the burger chain into the grocery selling business by selling packaged coffees at supermarkets in the U.S.
3G Capital, the investment firm that controls Burger King, will retain majority control over the combined company. Help with money needed to finance the transaction will come from one of 3G’s biggest admirer’s, Warren Buffet, who is purchasing $3 billion worth of preferred shares in the new company.