Wall Street has found a voracious appetite for Burger King shares, despite months of carping about the hamburger chain's poor profitability and failure to come up with new healthy-eating options to attract customers.
The company debuted on the New York Stock Exchange yesterday and its shares rose sharply from a float price that had already been set at the top end of the range. After four hours' trading, the stock rose 5 per cent, valuing Burger King at $2.4bn (£1.3bn).
Investors swallowed their doubts about the company's prospects, its private-equity-dominated ownership and its recent management upheaval to get a piece of the action in what is a hot stock-market sector.
Successful flotations of restaurant chains in the past year have included the Mexican fast-food chain Chipotle, which was spun off by McDonald's.
John Chidsey, promoted to chief executive last month after the unexpected departure of Greg Brenneman halfway through the flotation process, said he expected the company to prosper if higher interest rates and petrol prices stopped people eating out at more expensive restaurants.
Burger King raised $393m to pay back loans it used this year to fund a dividend to its private-equity owners, Goldman Sachs, Texas Pacific and Bain Capital..Reuse content