ISRAEL: Seven buyers fighting over Burger King
Seven groups are currently vying to buy the failing Burger King Israel fastfood chain.
The buying frenzy is being played out as the chain fires senior staff members, while its competitor, Burger Ranch, continues to reduce its staff as an efficiency measure.
McDonald's, however, continues to operate at relative and steady profitability and maintains its lead position in the country's fastfood business. According to press reports, McDonald's profits for 2002 are expected to reach NIS10m (US$2.08m), the same as in 2001, "with no plans at the moment to establish additional restaurants."
The most recent bidder for Burger King is a group of investors representing food and finance sectors, which offered $6m to purchase the franchise. The present owner of the Burger King Israel franchise, Israeli-American entrepreneur Meshulam Rikils, has been reported to be forming a group of investors with the aim of reconstructing the chain.
The price offered by the seven groups runs between $6-9m. A report in Maariv notes that Burger King-Israel workers requested that the government's Antitrust Commissioner "prohibit the sale of Burger King to McDonald's and Burger Ranch, which jointly submitted a bid to buy the Burger King chain, thus erasing the brand in Israel." The Antitrust Commissioner announced last week that he favours the sale of the Burger King chain "to a third party with the intention that the chain will operate as a living entity."
Burger Ranch, wholly owned by the Paz Fuel Company, in the past few weeks fired several middle management staff and reduced its service scope. The chain operates 95 restaurants, in most cases in a competing environmental proximity to its archrivals, McDonald's and Burger King.
Companies: Burger King
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