Fast food company Burger King Holdings, Inc. (NYSE:BKW) went public earlier last week, after going private in late 2010. Rather than going through the IPO route, the company was listed in the NYSE through a merger with an existing public stock, Justice Holdings, a UK investment firm that previously traded on the LSE. (3G Capital, which is Burger King’s private ownership group, received US$1.4 billion from Justice Holdings for a minority stake in BKW, while Justice Holdings suspends its stock and changes its name to Burger King Worldwide and then re-list in the NYSE. 3G Capital retains a 71% stake in BKW.)
After three days of trading starting on Wednesday when it opened at $14.50, BKW delivered an impressive 9.3% gain by closing at $15.85 on Friday. Notwithstanding the initial euphoria, investors remain wary about the company, especially given its past record. BKW went private twice in the last decade in 2002 and 2010. Moreover, the company, which has more than 12,500 restaurants worldwide of which about 90% are franchised, has struggled to keep up with its industry rivals like McDonalds Corp. and Dunkin’ Brands Inc. It also doesn’t help that the company had 13 chief executives in the past 25 years, and uninspiring results from numerous strategy shifts and marketing campaigns.