Tim Hortons China is expected to become publicly traded through a deal with a special purpose acquisition company (SPAC), skirting the tedious IPO procedure.
The Canadian coffee chain is in talks with blank-check Nasdaq-listed Silver Crest Acquisition Corp. (Nasdaq: SLCRU), according to Bloomberg. Listed in a $345 million IPO in mid-January, Silver Crest has among its shareholders Greater China-focused private equity firm Ascendent Capital Partners.
Counting over 4,900 locations worldwide, Tim Hortons shops now operate under Canadian fast food conglomerate Restaurant Brands International Inc. (NYSE: QSR), which also owns Burger King and Popeyes Louisiana Kitchen. In addition to RBI, Tim Hortons China branch is part-owned by equity firm Cartesian Capital Group. Other backers are Eastern Bell Capital and Sequoia Capital China, as well as tech giant Tencent Holdings (HKEX: 0700; OTC: TCEHY).
Tim Hortons operates 150 stores in 10 cities in China and plans to expand to 1,500 in competition with Luckin Coffee (OTC: LKNCY) and Starbucks (Nasdaq: SBUX), the former counting over 6,500 locations and the latter operating 4,700 stores across the nation as of 2020.
Bloomberg said in a Thursday report, citing unnamed sources, that the agreement between Tim Hortons and Silver Crest could be reached this week. The deal would value the company at $1.8 billion.