Burger King will invest $500 million in remodeling about 600 of its restaurants.
The parent company of Burger King is buying out its biggest franchisee in the United States for about $1 billion, and will renovate hundreds of its locations.
Restaurant Brands International Inc. will acquire all of the issued and outstanding shares of Carrols Restaurant Group Inc. that it doesn’t already hold for $9.55 per share.
Syracuse, N.Y.-based Carrols runs 1,022 Burger King restaurants in 23 states, including most locations in Florida. Its ownership amounts to about 15% of all U.S. Burger King locations. It also owns and operates 60 Popeyes restaurants.
“We are going to rapidly remodel these restaurants over the next five years or so and put them back into the hands of motivated, local franchisees to create amazing experiences for our guests,” Tom Curtis, president of Burger King U.S. and Canada, said Tuesday in a prepared statement.
Restaurant Brands plans to invest approximately $500 million, funded by Carrols’ operating cash flow, to remodel about 600 of the acquired Carrols restaurants.
Burger King anticipates the refranchising of the acquired restaurants being completed in five to seven years. The brand plans to keep about 200 restaurants in its company restaurant portfolio.
Restaurant Brands is in the midst of a multiyear effort to modernize its U.S. restaurants in an effort to catch up to rivals. McDonald’s announced a $6 billion plan to remodel its U.S. restaurants in 2018, for example.