Burger King, Tim Hortons, and Firehouse Subs parent company Restaurant Brands International announced Tuesday one of its subsidiaries has acquired all equity interests in Burger King China from TFI Asian Holdings BV and Pangaea Two Acquisition Holdings XXIII, Ltd. The deal is for $158 million in cash.
RBI now owns nearly 100 percent of the Burger King China segment and said it will engage advisers to assist the company in finding a new local partner to “inject primary capital into the business and become the controlling shareholder.” Not unlike its evolution in the U.S. over the last couple of years, RBI said the aim long-term will be to link with “experienced local operators while maintaining a primarily franchised business.”
In 2024, the brand spent $1 billion to acquire its largest franchisee Carrols Restaurant Group, a group that owned roughly one in every seven U.S. Burger Kings. The decision was intended to accelerate hundreds of remodels as RBI pushed toward a “Sizzle” Burger King model, but also to refranchise units over the next five years. Last week, Burger King initiated work to start selling locations in 2025, two years ahead of schedule. It expects to further accelerate efforts in 2026. RBI’s new preference is for operators to have no more than 50 units; Burger King currently has 300 franchisees. That’s expected to move to roughly 400–500 in the next few years.
TFI helped grow Burger King in China from about 60 stores in 2012 to 1,500 today. The company will continue expanding operations in Turkey.
“We are thankful for TFI’s and Cartesian’s partnership over the years and their role in expanding the brand in China,” Rafael Odorizzi, president of Asia Pacific for RBI, said in a statement. “This transaction marks the beginning of a new chapter for Burger King in China and reinforces our commitment to long-term growth in the region as we identify a new local operating partner. We are committed to offering our guests high quality food and exceptional experiences in welcoming restaurants across China.”
RBI completed its Carrols acquisition on May 16 and then made another deal on June 28 when it bought Popeyes China. The latter had 14 restaurants in Shanghai.
As part of the purchase, the company bought Popeyes China for $15 million from Tims China, the master franchisee group running development for Tim Hortons in mainland China, Hong Kong, and Macau. RBI also partnered with Cartesian Capital Group—which cofounded Tims China alongside Tim Hortons—to pour up to $50 million into the beverage business. RBI said it would provide up to $30 million and Cartesian Capital Group would bring $20 million.
And, again, clarifying the larger theme, RBI said it expected the pace of growth to increase via investments in local teams and restaurant development.
RBI’s purchase of Popeyes China allowed Tims China to “redouble its focus” on the Tim Hortons segment. Following the transaction, the company had the right to appoint two members to Tims China’s board of director and saw its equity ownership increase to as much as 18 percent.
This China redirect goes back to Q4 2023 when RBI said it was dissatisfied with its growth rate in one of quick service’s largest markets.. Initially, RBI aimed for more than 5 percent net restaurant growth in 2024, expecting accelerated development compared to 2023. However, the company switched to a mid-4 percent range projection due to insufficient investment from Chinese franchise partners.
It’s now taken control. Following the Carrols and PLK China acquisitions, RBI established a new operating and reportable segment, Restaurant Holdings. That comprises results from Carrols Burger King units and the PLK China restaurants. So today it reports publicly under six operating areas: Tim Hortons, Burger King, Popeyes, Firehouse, International, and RH. RH will also add Firehouse Subs Brazil in 2025.
The company does not plan to own and operate these businesses permanently, which is why it carved them out to maintain its franchisor relationship with RBI’s BK and International segments.
RBI plans to refranchise the vast majority of its Carrols Burger King restaurants and find a new partner for PLK China.
The International segment in Q4 2024 saw year-over-year systemwide growth of 11.2 percent to $4.643 billion in systemwide sales. Same-store sales lifted 4.7 percent on top of last year’s 4.6 percent growth. RBI reported net restaurant growth of 6.1 percent to 15,639 restaurants. The lift mostly owed to Burger King International growing its systemwide sales 8 percent and Popeyes International 47.5 percent.
The RH segment for Burger King, however, reported negative systemwide growth, year-over-year, down 1 percent against last year’s decline of 0.7 percent. There was $448 million in systemwide sales and same-store sales inched 1.6 percent. The total restaurant count was 1,017—the same as a year ago. For RH international, there were 19 locations.
CFO Sami Siddiqui, the former Popeyes president who was elevated to the role last March, said in the Q4 earnings report Burger King faced a 100-basis point year-over-year headwind in 2024 (the overall global comps for RBI grew 2.3 percent and net restaurant growth 3.4 percent).
“Importantly, given the low [average restaurant sales] contribution from BK China restaurants averaging around $400,000 per unit,” he said. “We did not experience the material impact to system-wide sales. We know … expectations are top of mind and we expect to have a resolution for Burger King China relatively soon [Tuesday’s news].”
The low ARS figure supports $158 million for a network of 1,500 locations, clarifying a relatively modest per-store valuation.
In 2024, RBI generated $37 million of royalty and franchise fee revenue from BK China, $19 million of which was reflected in its AOI. After terminating the agreement in October, it recorded bad debt expense for the remaining $18 million of revenue recognized but not collected.
“Therefore, if you were to model no change in the current situation, we would see $19 million year-over-year impact to our 2025 AOI, or about $0.03 on an EPS basis. Even factoring in this potential headwind, we are confident we would still deliver 8 percent plus AOI growth in 2025,” Siddiqui said.
The systemwide AUV figure for Burger King ended the year at $1.6 million. Tim Hortons is $2.54 million (Canadian) in its home country and Popeyes is north of $1.9 million in the U.S. Firehouse sits at nearly $1 million.
