This week, Restaurant Brands International Inc. and Firehouse Restaurant Group Inc. ("Firehouse Subs") announced that they have reached an agreement for RBI to acquire Firehouse Subs for $1 billion in an all-cash transaction. The sandwich chain with roughly 1,200 units across the U.S. is now the fourth brand in Restaurant Brands’ portfolio, which besides Burger King also includes Popeyes Louisiana Kitchen and Tim Hortons.
“Firehouse Subs adds a strong and loved restaurant brand with attractive unit economics in a complementary category to RBI's existing family of iconic quick service restaurant ("QSR") brands, Tim Hortons, Burger King, and Popeyes,” the company commented in a statement following the agreement.
According to RBI, the brand is a strong and growing player within the $30 billion U.S. QSR sandwich category and since 2010 has increased its number of restaurants to approximately 1,200 Units across 46 U.S. States, Canada and Puerto Rico. $1.1 billion in systemwide sales are expected for 2021. For the first 10 months of the year, Firehouse’s same-store sales climbed 20% compared the same period in 2019. Like Restaurant Brands’ other chains, the majority of Firehouse Subs’ locations are operated by franchisees.
Restaurant Brands said it would fund the all-cash deal through a combination of debt and using the cash it has on hand. Restaurant Brands expects the deal to close sometime over the next few months. After the transaction closes, Firehouse’s headquarters will remain in Jacksonville, Florida, and its CEO, Don Fox, and CFO Vincent Burchianti are expected to stay.
José Cil, Chief Executive Officer of RBI commented, "Firehouse Subs is a special brand with a talented team, impressive culture and community focus that resonates with guests and closely aligns with our core values at RBI. We see tremendous potential to accelerate U.S. and international growth at Firehouse Subs with RBI's development expertise, global franchisee network and digital capabilities. We are excited to welcome the Firehouse Subs team to the RBI family and to continue our ambitious dream of building the world's most loved restaurant brands."
Don Fox, Chief Executive Officer of Firehouse Subs said, "At Firehouse Subs we are united in our commitment to and passion for hearty and flavorful food, heartfelt service, and public safety. Joining the RBI family of brands provides an energizing opportunity to assist more communities, not only across America and Canada, but around the globe. The donations we generate for our Foundation through our restaurants means changing and saving lives, so we can't wait to accelerate our journey at home and around the world."
Restaurant Brands International Inc. is one of the world's largest quick service restaurant companies with approximately $34 billion in annual system-wide sales and over 27,000 restaurants in more than 100 countries. RBI owns three of the world's most prominent and iconic quick service restaurant brands – Tim Hortons, Burger King, and Popeyes. These independently operated brands have been serving their respective guests, franchisees and communities for over 45 years.