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Restaurant Brands International to acquire Firehouse Subs for $1 billion

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Yahoo Finance’s Julie Hyman and Brian Sozzi discuss how Burger King parent company Restaurant Brands International is buying Firehouse Subs for $1 billion.

Video Transcript

[MUSIC PLAYING]

JULIE HYMAN: A deal in the food business, you know that's got Brian Sozzi pumped this morning. It just broke, Restaurant Brands is buying firehouse subs, a billion dollar deal here. Sozz, how does this fit into Restaurant Brands? Is this the biggest acquisition they've made? Just put this in context as much as you can. I know it just came out.

BRIAN SOZZI: Yeah. No, a lot of thoughts. This is the first big deal by our new Restaurant Brands CEO, Jose Cil. He's been there for a little bit, but still, this is him, his first, I would say, big power move here. $1 billion all cash transaction for Restaurant Brands buying firehouse subs, which has 1,200 restaurants. And system sales for this year are expected to approach, according to the release, $1.1 billion.

So a big chain. That will join Tim Hortons, Burger King, and, of course, Popeyes as well. And really, now you're getting, I think, a real true direct competitor to what Arby's is doing. Arby's bought Buffalo Wild Wings a couple of years ago. Arby's also bought Jimmy John's for $2.1 billion. They're also a sub chain, they bought that in 2019. So, you really seeing, I think, these two companies now trading blows here.

JULIE HYMAN: Interesting. All right. Well, we'll have to see. Restaurant Brands, interestingly, the stock not reacting much this morning, just up about 9/10 of 1%. Although, actually, it may have closed for pre-market trading before this deal came out. And there we have a little bit of movement there. So we'll be watching that after the bell rings, as well.