Burger King plans aggressive expansion in Russia

June 6, 2012

Burger King Worldwide Holdings Inc. today announced the establishment of a new joint venture focused on aggressively expanding Burger King's presence in Russia. Under the new partnership, BKW; Burger Rus, the largest Burger King franchisee in Russia; and VTB Capital, a Russian investment bank, have committed to opening several hundred restaurants throughout the next few years.

"We believe there is tremendous opportunity to rapidly increase our market share in Russia's fast-growing and underpenetrated quick-service restaurant sector. Today's announcement is a great example of our company's strategy to accelerate international expansion by creating master franchisee agreements with strong local partners in high-growth markets," said José Cil, president, EMEA, BKW.

Burger Rus already has a strong presence in Russia, having opened 54 Burger King restaurants in the country in the last 30 months.

Under the terms of the new partnership, the venture has signed a long-term master franchise and development agreement with BKW, and has obtained the exclusive rights to expand the Burger King brand in Russia.

"The growth potential of the Russian QSR market is tremendous as we have witnessed by the success of the 54 Burger King restaurants that we already operate in the country," said Alexander Kolobov, managing shareholder, Burger Rus. "The strength of the Burger King brand and its world-famous menu items, such as the iconic Whopper sandwich, are key drivers for further growth in this market."

The partnership with Burger Rus and VTB Capital is the latest example of BKW's aggressive international growth strategy in key developing markets. In 2011, BKW introduced a similar joint venture in Brazil.

Burger Rus was advised in the transaction by Olympia Capital, which also retained a minority stake in Burger Rus within the framework of the joint venture.

Read more about franchising and growth.

Topics: Business Strategy and Profitability , Franchising & Growth , International , Operations Management

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