Burger King Worldwide Holdings Inc. formed a joint venture with
its largest franchisee in Russia, Burger Rus, and the Russian
investment bank VTB Capital as it looks to gain market share in
Russia's fast-growing quick-service restaurant sector.
Burger King, the world's second-largest fast-food chain behind
McDonald's, had struggled to attract customers, due in part to its
lack of menu development and flawed pricing. But the hamburger
chain has been gaining ground as the company reworked its menu,
restaurant appearance and advertising in preparation of going
public this summer.
Burger King said Burger Rus, the largest Burger King franchisee
in Russia, has opened 54 Burger King restaurants in Russia over the
last 30 months, and it and VTB Capital have committed to opening
several hundred restaurants over the next few years.
Under the long-term master franchise and development agreement,
the newly formed Russian joint venture has exclusive rights to
expand the Burger King brand in Russia.
Financial terms weren't disclosed.
Burger King was taken private in 2010 by the New York-based
private-equity firm 3G Capital Management through a deal valued at
$4 billion. The company in April reached a $1.4 billion cash deal
with U.K. investment vehicle Justice Holdings Ltd. (JUSH.LN) that
would bring the fast-food chain back to the public market. 3G
Capital will remain Burger King's principal shareholder with a 71%
stake in the public company.
Last month, Burger King reported it swung to a first-quarter
profit as revenue jumped 3.2% with the help of strong North America
sales.
Write to Melodie Warner at melodie.warner@dowjones.com