It has been many months since British giant Diageo announced its intention to divest Burger King in order to focus on its core drinks business; but the group has still not confirmed whether the fastfood giant will be subject to a management buyout or an IPO.
Go deeper with GlobalData
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
Speaking a press conference detailing Diageo’s H2 results yesterday, group finance director Nick Rose commented: “We have appointed advisers to look at all the options, and no single option has been ruled out at this stage.”
Indeed, the only definite news is that a new marketing strategy will be launched next week to boost sales in the US.
Rose said that Diageo “has invested heavily in Burger King… in people and the brand and products, [and the changes implemented by the group] are beginning to have an impact and relations with the franchises continue to improve.”
Nevertheless, H2 operating profits at the hamburger chain fell 29% to £79m (US$113m) while system-wide sales came in at US$5.8bn, up just 1.5% year on year.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataA Burger King sale could generate £1.5bn for Diageo, however the company has revealed that it faces large tax liabilities if it a sale is completed before 17 December, that is within five years of the merger by which the group was formed. Nevertheless, executives suggested a sale would be soon but were not prepared to confirm its nature. According to analysts, however, a MBO is looking more likely for the chain at present.
