- Franchise Restructuring: Burger King UK’s Bridgepoint Nears New Master Franchise Agreement
- Strategic Changes: Reduced Annual Openings and Potential Impact on Company’s Future
- Robust Recovery: Burger King UK’s Sales Growth and Confidence Amidst Post-Pandemic Challenges
Bridgepoint and Restaurant Brands International are in advanced discussions regarding a new master franchise agreement for the British operations of the fast-food chain.
The proprietor of Burger King’s operations in the United Kingdom is in advanced negotiations for a new franchise agreement that will reduce the number of new restaurants it must open annually.
Bridgepoint, a London-based private equity firm, is nearing a long-term agreement with Restaurant Brands International (RBI), the proprietor of the Burger King brand in the United States.
According to city sources, under a new master franchise agreement (MFA) that would run until approximately 2034, the owner of Burger King UK would be required to invest in at least 20 new openings per year, with that number increasing to nearly 40 over time.
They added that an agreement is likely to be announced within weeks.
It followed discussions between Bridgepoint and the Reserve Bank of India in which the private equity firm reportedly expressed dissatisfaction with the financial returns it was receiving in a highly inflationary cost environment.
According to industry sources, Burger King’s UK sales growth has been robust in recent months, outpacing competitors and the company’s management is confident that this trend will continue.
Approximately 290 of the 600 Burger King locations in the United Kingdom are also owned by Bridgepoint, with the remainder owned by other franchisees.
A new MFA could help pave the way for the eventual sale or IPO of the company, although neither option is believed to be imminent.
Since 2017, Bridgepoint has owned Burger King UK, with industry veteran Martin Robinson serving as chairman and Alasdair Murdoch as chief executive.
Its balance sheet, like those of other chains, was severely impacted by the pandemic, but it has since recovered strongly, despite concerns about consumer confidence.
