Tim Hortons
Tim Hortons Inc., known colloquially as Tim's, Timmies or Timmy's, is a Canadian multinational coffeehouse and restaurant chain with headquarters in Toronto; it serves coffee, donuts, sandwiches, breakfast egg muffins and other fast-food items. It is Canada's largest quick-service restaurant chain, with 5,701 restaurants in 14 countries, as of.
The company was founded in 1964 in Hamilton, Ontario, by Canadian ice hockey player Tim Horton and Jim Charade, after an initial venture in hamburger restaurants. In 1967, Horton partnered with investor Ron Joyce, who assumed control over operations after Horton died in 1974. Joyce expanded the chain into a multi-billion dollar franchise. Charade left the organization in 1966 and briefly returned in 1970 and 1993 through 1996. The Wendy's Company merged with Tim Hortons in 1995 and operated it under their flagship subsidiary until 2006.
On August 26, 2014, Burger King agreed to merge with Tim Hortons for US$11.4 billion. The two chains became subsidiaries of Toronto-based holding company Restaurant Brands International on December 15, 2014.
History
1964–1989: Tim Horton and Ron Joyce
The business was founded by Tim Horton, who played in the National Hockey League from 1949 until his death in an auto crash in 1974. The first Tim Horton restaurant was in North Bay, Ontario, and sold hamburgers. The chain's first donut store opened on May 17, 1964, in Hamilton, Ontario, under the name Tim Horton Donuts. The name was later abbreviated to "Tim Horton's" and then changed to "Tim Hortons" without the possessive apostrophe.Soon after Horton opened the store, he met Ron Joyce, a former police constable in Hamilton. In 1965, Joyce took over the fledgling Tim Horton Donut Shop at 65 Ottawa Street North. By 1967, after opening two additional stores, the two became full partners. Upon Horton's death in 1974, Joyce bought out the Horton family's shares for $1 million and took over as sole owner of the existing chain of 40 stores, quickly and aggressively expanding the chain in both geography and product selection. The 500th store opened in 1991.
Joyce's aggressive expansion of the business resulted in major changes to the Canadian coffee and donut restaurant market. Many independent donut shops and small chains were driven out of business, while Canada's per-capita ratio of donut shops surpassed that of all other countries.
The Horton and Joyce partnership carried on, with the marriage of Joyce's son, Ron Joyce Jr., and Horton's eldest daughter, Jeri-Lynn Horton-Joyce, who were joint owners of Tim Hortons franchises in Cobourg, Ontario, until 2023 when the couple retired after 37 years.
1990–2002: Name change and growth
The company had originally been incorporated as Tim Donut Limited. By the 1990s, the company name had changed to The TDL Group Ltd. This was an effort by the company to diversify the business, removing the primary emphasis on donuts, and continuing the expansion of the menu options as consumer tastes broadened.Some older locations retain signage with the company's name, including a possessive apostrophe, despite the fact that the official styling of the company's name has been Tim Hortons without an apostrophe for at least a decade. The company had removed the apostrophe after signs using the apostrophe was interpreted by some to be breaking the language sign laws of the province of Quebec in 1993. The removal of the apostrophe allowed the company to have one common sign image across Canada.
Although a number of Quebec locations have bilingual menu boards, the decision to have both Canadian official languages represented is left to the discretion of individual franchise owners. Some Quebec locations have French-only menu boards. It is the strong recommendation to all the Quebec restaurants from the TDL Group Corporation that they post menu boards in both English and French in accordance with the standards being enforced by the Office québécois de la langue française.
Merger with Wendy's
In 1992, the owner of all Tim Hortons and Wendy's restaurants in Prince Edward Island, Daniel P. Murphy, decided to open new franchise outlets for both brands in the same building in the town of Montague. Murphy invited Joyce and Wendy's chairman Dave Thomas to the grand opening of the "combo store," where the two executives met for the first time. Murphy's success with combining coffee and donuts with Wendy's fast food led to the August 8, 1995, acquisition of and merger with TDL Group by Wendy's International, Inc., an American company; this lasted until 2009.The sale was widely commented on in the media. In 1995, the Toronto Star had a column reflecting on Tim Hortons "selling out" to Wendy's with "the spectacle of another great Canadian icon...gone to Yankee burgerfat".
2002–2006: Regaining independence
Tim Hortons franchises spread rapidly and eventually overtook McDonald's as Canada's largest food service operator. The company opened twice as many Canadian outlets as McDonald's by 2005, and system-wide sales also surpassed those of McDonald's Canadian operations as of 2002. The chain accounted for 22.6% of all fast-food industry revenues in Canada in 2005.Under pressure from major investors Peter May and Nelson Peltz, in late 2005, Wendy's announced it would sell between 15% and 18% of the Tim Hortons operations in an initial public offering, which was completed on March 24, 2006, and subsequently said it would spin-off to shareholders its remaining interest by the end of 2006. Wendy's cited increased competition between the two chains and Tim Hortons' increasing self-sufficiency as reasons for its decision, but the company had been under shareholder pressure to make such a move because of the strength and profitability of the Tim Hortons brand.
Shares of the company began trading on March 24, 2006, with an initial public offering of per share, raising over $700 million in the first day of trading. On September 24, Wendy's spun off the rest of its shares in Tim Hortons by distributing the remaining 82% to its shareholders. On the same day, Tim Hortons was added to Canada's benchmark stock-market indicator, the S&P/TSX Composite Index, and to the S&P/TSX 60.
As of March 2006, Tim Hortons commanded 76% of the Canadian market for baked goods and held 62% of the Canadian coffee market.
During this period Tim Hortons also introduced the Tim Hortons Express format, a compact kiosk model offering beverages and a limited baked-goods menu. These outlets were installed in non-traditional venues such as universities, airports, and military facilities.
2007–2013: Repatriation
On June 29, 2009, Tim Hortons Inc. announced that, pending shareholder approval, the chain's operations would be reorganized under a new publicly traded company, also named "Tim Hortons Incorporated", incorporated under the Canada Business Corporations Act. The change was being made primarily for tax purposes. On September 28, 2009, Tim Hortons Inc. announced it had completed the reorganization of its corporate structure to become a Canadian public company.In November 2010, Tim Hortons extended Interac debit payment system acceptance to most of its stores. The company previously began accepting Interac in its stores in Western Canada in 2003 and, later, MasterCard and MasterCard PayPass across most of its stores in 2007. The company often indicated the delay of broader or wider electronic payment acceptance was to "ensure speed of service." In 2012, Tim Hortons began accepting Visa cards, and in 2013, began accepting American Express cards.
In late 2013, Tim Hortons had "4,350 cafes across the world, out of which 3,500 are in Canada, 817 in the U.S. and 33 in the GCC. The Toronto Stock Exchange listed company recorded revenues of $794 million and net profit of $111 million in the September quarter."
2014: Merger with Burger King
On August 24, 2014, American fast-food chain Burger King announced that it was in negotiations to merge with Tim Hortons Inc.; the proposed $18 billion mergers would involve a tax inversion into Canada, with a new holding company majority-owned by 3G Capital, and the remaining shares in the company held by current Burger King and Tim Hortons shareholders. A Tim Hortons representative stated that the proposed merger would allow Tim Hortons to leverage Burger King's resources for international growth; the two chains would retain separate operations post-merger. News of the proposal caused Tim Hortons' shares to increase in value by 28 percent.On August 25, 2014, Burger King officially confirmed its intent to acquire Tim Hortons Inc. in a deal totaling . 3G Capital offered to purchase the company at $65.50 per share, with existing shareholders receiving $65.50 in cash and 0.8025 shares in the new holding company: per-share—all-cash and all-shares options were also made available. The agreement planned to result in 3G Capital holding a 51% majority stake in the new company, Tim Hortons' existing shareholders owning 22%, and Burger King's owning 27% with the new entity based in Oakville and listed on both the TSX and New York Stock Exchange. Per the agreement, Burger King CEO Daniel Schwartz became CEO of the company, with existing Tim Hortons CEO Marc Caira becoming vice-chairman and director; Burger King still operated out of its existing headquarters in Miami. It was announced the deal would form the third-largest fast-food restaurant company in the world. On October 28, 2014, the deal was approved by the Competition Bureau of Canada, but had yet to be approved by Industry Canada. The Bureau ruled that the deal was "unlikely to result in a substantial lessening or prevention of competition."
Former CEO Marc Caira reassured the integrity of Tim Hortons following the purchase, stating that the acquisition would "enable us to move more quickly and efficiently to bring Tim Hortons iconic Canadian brand to a new global customer base." On October 30, 2014, various media covered a Canadian Centre for Policy Alternatives study which suggested that Burger King's proposed takeover of Tim Hortons is "likely to have overwhelmingly negative consequences for Canadians." This study analyzed Burger King's private equity owner, 3G Capital, and past takeovers of Burger King, Heinz, and Anheuser-Busch, and declared that "it has a 30-year history of aggressive cost cutting, which could hurt Tim Hortons employees, small-businesspeople, Canadian taxpayers, and consumers."
The deal was approved by Minister of Industry James Moore on December 4, 2014: The two companies agreed to Moore's conditions, requiring that the Burger King and Tim Hortons chains retain separate operations and not combine locations, maintain "significant employment levels" at the Oakville headquarters, and ensure that Canadians make up at least 50% of Tim Hortons' board of directors. Tim Hortons shareholders approved the merger on December 9, 2014; the two chains merged under the new parent company Restaurant Brands International, which began trading on December 15, 2014. According to CBC News, "how the government will enforce conditions is unclear."