DARREN - Key Persons
Job Titles:
- Chief Executive of Così 18
- Così CEO
Carin Stutz has resigned as chief executive of Così 18 months after taking the top post at the long-struggling brand.
Job Titles:
- Vice President of Federal Issues for the Silicon Valley Leadership Group
Job Titles:
- Chief Public Affairs and Global Nutrition Officer Jonathan Blum
Guzman Y Gomez, launched in Australia in 2006, is a fast-casual Mexican taqueria that prides itself on being one of the first concepts to bring authentic Mexican food and Latin culture to Australia. The chain celebrates all things Latin: the region's music, art, personality and especially the food. It specializes in burritos, mini burritos, tacos and bowls prepared with a choice of meat or vegetables and various toppings. It operates both small walk-up operations in food courts and lifestyle centers and larger units, which have TVs, foosball tables and billiards, and a bold décor heavily incorporating the brand's yellow-and-black color scheme. Units also typically feature exposed brick, framed black-and-white photos and potted cactus plants. Since its founding, Guzman Y Gomez has expanded across eastern Australia.
Why it's worth watching: Guzman Y Gomez has carved out a niche in Australia as one of the only chains offering authentic, made-to-order Mexican fare, and aims to compete against fast-casual Mexican leaders.
Job Titles:
- Managing Director at Hedgeye
Burger King first became financial fodder in 1967 when it was bought by Pillsbury, which didn't have a clue about how to run a restaurant chain. Then in 1988, a British company, Grand Metropolitan, initiated a hostile takeover and won Pillsbury. The new owners vowed to turn Burger King around.
It didn't happen. Nine years later, Grand Met merged with Guinness to form Diageo, by which time Burger King's role was well established. It shipped cash to headquarters, even as it lagged ever further behind McDonald's.
Enter - ta-da! - private equity. In 2002, Goldman Sachs, along with two private equity firms, TGP and … hmmm … Bain Capital, teamed up to buy Burger King. This is exactly the kind of situation private equity firms like to trumpet: taking over a downtrodden company and nursing it back to health. And to get them their due, Burger King's new owners did some good, stabilizing both the company and the franchisees, many of whom were in worse shape than Burger King itself.
But the private equity investors also cut themselves an incredibly sweet deal. Their $1.5 billion purchase price included only $210 million of their own money; the rest was borrowed. They immediately began taking out tens of millions of dollars in fees. Four years later, they took Burger King public. But, first, they rewarded themselves with a $448 million dividend. In all, according to The Wall Street Journal, "the firms received $511 million in dividend, fees, expense reimbursements and interest" - while still retaining a 76 percent stake.
Does it need to be said that Burger King was soon back to its old struggling self? Or that the solution, once again, was to sell to another private equity firm? Of course not! In 2010, Bain, Goldman and TPG cashed out, selling Burger King to 3G Capital, for $3.3 billion. In sum, the original private equity troika reaped a fortune by selling a company that was in nearly as much trouble as it had been when they first bought it. Surely this represents the apotheosis of financial engineering.
What has 3G done? According to Howard Penney, the managing director at Hedgeye, it has prettied up the pig by laying off a large percentage of the staff in Burger King's Miami headquarters. Burger King's owners grew earnings, he said, "by cutting expenses. They have not improved the business one iota." And, of course, 3G pulled out fees and dividends, too. In all, Penney wrote recently, private equity firms have taken for themselves "$1 billion or more in capital that could have been used to improve the company's relative standing versus its competitors, many of whom Burger King struggles to keep up with."
This latest deal is just as complicated as the ones that have come before. Three financiers, including William Ackman, the well-known shareholder activist, put together a special purpose acquisition company, or SPAC - a vehicle that allows them to raise money, buy a company and take it public without the hassle of an I.P.O. The SPAC then bought a stake in Burger King, though 3G is still in charge. On its first day of trading, Burger King had a market value of $3.3 billion. When you include its fees and dividends, 3G has already made a tidy sum on its original investment.
Ackman told me that the 3G guys are "the best operators around, bar none." He sent me a presentation for investors that suggests that the owners are prepared to modernize the stores, expand abroad and make other moves that are necessary for Burger King to remain competitive.
Fields became president of the U.S. business in 2010, succeeding Thompson. She previously was chief operating officer of McDonald's USA, stepping into that role in 2006. Fields is a 35-year veteran of McDonald's who began her career with the company behind the restaurant counter.
Job Titles:
- Senior Vice President and Investment Adviser in Allied Beacon Partners' Milwaukee
Restaurant executive Nick Vojnovic found a novel way to beat back a mid-life crisis after he moved on from a decade-long gig running sports pub chain Beef ‘O' Brady's.
Pie Face, started in 2003 by an American living in Sydney, is a quick-service bakery-café chain known for its freshly baked sweet and savory pies marked with smiley-face designs on the crust. Popular varieties include chunky steak and Thai chicken curry. Stores are counter-service operations that occupy as little as 160 square feet. Whenever possible, they stay open 24 hours a day. Rows of pies and other pastries are showcased in glass cases, and red and black menu boards list the brand's offerings. After getting under way in Sydney, the chain opened stores throughout Australia and began franchising in 2009. In early 2012, the chain made its U.S. debut, opening a unit in New York City-the first of many planned for the Big Apple.
Why it's worth watching: Pie Face is bringing Aussie-style handheld, savory meat pies to American consumers, who may be open to this portable and inexpensive meal option.
R.J. Hottovy, an analyst with Morningstar, said "it's tough to read" into the reasons behind Fields' departure, but the shake-up won't affect his short-term view.
Job Titles:
- Analyst at BGB Securities
Job Titles:
- McDonald 's Chief Executive
Tim Horton's continued to lead the Canadian foodservice industry in terms of both sales and units. McDonald's and Subway both outpaced Tim Horton's sales growth, but came in second and third respectively in terms of total sales.