It's not yet clear what Burger King's new owner, the Brazilian-backed private equity firm 3G Capital, has in mind for the troubled No. 2 fast-food chain. But a total strategic revamp is in order.
Burger King (BKC), which went public four years ago after its previous private equity owners cashed out, has limped its way through the recession, losing sales and market share even as its far-better-managed rival, McDonald's (MCD, Fortune 500), has thrived. Thriving is what fast-food purveyors are supposed to do during a recession, when diners tend to trade down. But Burger King has stubbornly stuck to a losing strategy, falling further behind with each passing quarter. The result: A loss in share value over the two years up until Tuesday -- just before rumors of the buyout started to float -- of 36%. McDonald's shares over the same period rose 14%.
It will be interesting to see what the new Brazilian owners will make of Burger King's grandiose vision. Chidsey will step down as CEO, but will remain as a co-chairman along with Alex Behring, 3G's managing director. Supposedly they'll work together to find a new chief.
For more: What went wrong at Burger King - Sep. 3, 2010
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