Deal of the Week: to buy Canada's for $11.5B

Announcement Date  August 26, 2014 Acquirer  Burger King Worldwide (NYSE: BKW) Acquirer Description  Operates and franchises restaurants under brand name. Approximately 14,000 locations worldwide  Founded in 1954 and headquartered in , Florida Acquirer Financial  Mkt Cap: $11.3 billion  LTM EBITDA: $672.1 million Statistics  EV: $13.4 billion  LTM EV / Revenue: 12.9x  LTM Revenue: $1.0 billion  LTM EV / EBITDA: 19.9x Target Company  Tim Hortons (TO: THI.TO) Target Description  Develops and franchises service restaurants primarily in Canada and the United States. As of June 29, 2014, the company had 3,630 locations in Canada and 866 in the United States  Founded in 1964 and headquartered in Oakville, Canada Target Financial  Mkt Cap: $10.7 billion  LTM EBITDA: $758.1 million Statistics (in USD)  EV: $12.0 billion  LTM EV / Revenue: 3.9x  LTM Revenue: $3.1 billion  LTM EV / EBITDA: 15.8x Price / Consideration  Price: $11.5 billion  Consideration: Cash & Stock Acquirer Advisor  JP Morgan and Wells Fargo Rationale  In announcing their $11.5 billion merger, Burger King and Tim Hortons declared their intentions to become a truly global fast‐food empire whose offerings span from breakfast to dinner Deal Points  Under the terms of the deal, Burger King will pay 65.50 Canadian dollars in cash and 0.8025 of one of its shares for each Tim Hortons share. That amounts to $85.78 a share, based on Burger King’s closing price on Monday  The combined company will be based in Canada, where its biggest market is. And Tim Hortons will still be run out of its home base in Oakville, . Burger King will be operated from Miami  Shares in the new combined entity will be listed on the Stock Exchange and the Stock Exchange Of Note  agreed to buy $3 billion worth of preferred stock, which carries an annual dividend of 9%, to help finance the deal, on top of $9.5 billion in debt financing arranged by JPMorgan Chase and Wells Fargo  The acquisition highlights the ever‐higher ambitions of Burger King’s majority owner, . In just six years, the firm has taken over Burger King and the ketchup colossus H.J. Heinz and helped orchestrate the megamerger of the beer giants InBev and Anheuser‐ Busch

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