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Burger King Puts Itself on the Block

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Private equity deals appear to be coming back in vogue in the retail sector. Earlier today, The Street reported that Burger King has been discussing buyout possibilities with several private equity players. In the past two years, the chain has been trying out new strategies in an effort to catch up with its main rival, McDonald's, and the desire to go private might be tied to the greater freedom afforded retailers who don't have to report to Wall Street. Burger King has gone through a buyout and a subsequent IPO before: in 2002, it sold itself to the consortium of TPG Capital, Bain Capital and Goldman Sachs. The partners put Burger King back on the public market in 2006.

Right now may be a good time to market itself to prospective buyers, as private equity players are sitting on mountains of cash that need to be spent. But buyout specialists are no longer as indiscriminate as they once were. Before they spend their money, they want to make sure the retailer they pick up is not going to become a money loser. For example, Saks Fifth Avenue recently put itself on the block as well. But so far, it has failed to secure a buyer because private equity worries about the outlook on luxury goods in the current environment.

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Elaine Misonzhnik

Senior associate editor Elaine Misonzhnik has been writing for National Real Estate Investor since June 2006 and has covered commercial real estate for more than 12 years. She first became...
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