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3G Capital

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3G Capital Inc.
Company typePrivate
IndustryInvestment firm
Founded2004; 20 years ago (2004)
Headquarters
New York City
,
United States
Key people
Jorge Paulo Lemann
Alex Behring
(Co-Founder & Co-Managing Partner)
Daniel Schwartz
(Co-Managing Partner)
ProductsFood products, restaurants, beverages, architectural and window coverings products
Number of employees
20+
Websitewww.3g-capital.com

3G Capital is a global investment firm and private partnership built on an owner-operator approach to investing over a long-term horizon.[1] Founded in 2004, 3G Capital evolved from the Brazilian investment office of Jorge Paulo Lemann, Carlos Alberto Sicupira, and Marcel Herrmann Telles. 3G Capital is led by Alex Behring, Co-Founder and Co-Managing Partner, and Daniel Schwartz, Co-Managing Partner.[1][2]

The firm is best known for its long-term investments in Anheuser-Busch InBev, Restaurant Brands International (Burger King, Tim Hortons, Firehouse Subs, and Popeyes Louisiana Kitchen), Hunter Douglas, Kraft Heinz as well as partnering with Berkshire Hathaway for its acquisitions.[3][4][5][6][7][8]

Notable Deals

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In 2010, the company acquired Burger King for $3.3 billion, and subsequently took the company private. Under new management, Burger King went on to introduce a reworked menu and innovative marketing strategies.[9][10][11]

In June 2012, Burger King was once again listed as a publicly traded company through a $1.4 billion deal with Justice Holdings. Despite the relisting, 3G Capital retained a 71% stake of the company.[11]

In December 2014, the Canadian government approved the purchase of Tim Hortons by 3G Capital for $12.5 billion, creating Restaurant Brands International, the world's third largest quick service restaurant company and a new global powerhouse.[12][13]

In March 2015, 3G Capital partnered with Warren Buffett to acquire Kraft Foods for $40 billion, and merged it with Heinz to form the world's fifth largest food company.[14][15] In September 2021, Kraft Heinz announced that Hemmer, a Brazilian company focused on condiments and sauces, was acquired for an undisclosed amount.[16] The acquisition followed an agreement with Assan Foods – a Turkish company focused on sauces – belonging to Kibar Holding, for approximately $100 million.[17]

Restaurant Brands International went on to acquire Popeyes Louisiana Kitchen, Inc. in 2017 for $1.8 billion, and Firehouse Restaurant Group Inc. for $1.0 billion in 2021.[18][19] 3G Capital Co-Managing Partner Daniel Schwartz who served as CFO (Jan. 2011 to Mar. 2013), COO (Mar. 2013 to Jun. 2013), and CEO (Jun. 2013 to Jan. 2019) is credited for turning around Burger King and later growing the Restaurant Brands International holding group.[20][21][22] After stepping down as CEO, Daniel Schwartz went on to serve as Co-Chairman of the Board alongside Alex Behring from 2019 to 2021 and both continue to serve on the Board of Directors today.[23][20]

Since its 2010 acquisition of Burger King Holdings, 3G Capital has been the company's largest shareholder, supporting its global growth transformation including the creation of RBI and acquisitions of Tim Hortons, Popeyes Louisiana Kitchen, and Firehouse Subs, generating approximately twenty-one times in total shareholder returns.[24]

On December 30, 2021, 3G Capital entered into a definitive agreement to acquire 75% of interest in Hunter Douglas, a global market leader in window coverings and a major manufacturer of architectural products.[8] The deal was completed on February 25, 2022, for approximately US $7.1 billion.[25] 3G Capital Partner João Castro Neves was appointed Hunter Douglas Group CEO.[26]

In 2023's fourth quarter 3G Capital sold off its 16.1% stake in Kraft Heinz. The sale marks the end of an era for 3G because their investment playbook based on cost-cutting measures had success in all previous investments. After a disastrous quarter for Kraft Heinz in 2019, some investors pointed fingers at 3G’s penchant for strong cost-cutting without an adequate attention to innovation.[27]


3G Capital Portfolio

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Burger King restaurant in Bulacan, Philippines
Budweiser brewery in St. Louis, USA
Heinz factory in Pittsburgh, USA

Restaurants

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Beverages

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Manufacturing

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Offices and Management

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3G Capital is headquartered in New York City, and is led by Alex Behring, Co-Founder and Co-Managing Partner, and Daniel Schwartz, Co-Managing Partner.[1][2]

References

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  1. ^ a b c "Home - 3G Capital". 2019-10-22. Retrieved 2023-05-23.
  2. ^ a b Fontanella-Khan, James (2021-12-31). "3G Capital buys majority stake in Hunter Douglas for $7.1bn". Financial Times. Retrieved 2023-05-29.
  3. ^ Gelles, David (26 March 2015). "3G Capital, Warren Buffett's Favorite Partner in Deals Worth Billions". The New York Times. Retrieved 25 May 2023.
  4. ^ Mahler, Daniel (30 June 2016). "Zero-Based Budgeting Is Not a Wonder Diet for Companies". Harvard Business Review. Retrieved 30 June 2016.
  5. ^ Cheng, Evelyn (17 February 2017). "3G and Buffett's Berkshire behind what could be the largest US purchase of a foreign company". CNBC. Retrieved 14 December 2017.
  6. ^ "The lean and mean approach of 3G Capital". Financial Times. 7 May 2017.
  7. ^ "Can 3G Capital Keep Thriving on Acquisitions and Cost Cutting?". The New York Times. 7 March 2017.
  8. ^ a b "3G Capital to Acquire Controlling Interest in Hunter Douglas".
  9. ^ "Burger King launches biggest marketing, menu initiatives ever". www.qsrweb.com. 2012-04-02. Retrieved 2023-06-05.
  10. ^ "Burger King agrees to $3.3 billion sale to 3G Capital". Reuters. 2010-09-02. Retrieved 2023-06-05.
  11. ^ a b Warner, Melodie (1 August 2012). "Burger King's New Menu, Marketing Boost Profit". WSJ. Retrieved 9 September 2015.
  12. ^ "World's Third Largest Quick Service Restaurant Company Launched with Two Iconic and Independent Brands: Tim Hortons and Burger King". www.rbi.com. Retrieved 2023-06-05.
  13. ^ "Tim Hortons confirms layoffs at headquarters, regional offices". CBC News. 27 January 2015. Retrieved 28 January 2015.
  14. ^ "Kraft and Heinz merger to form world's fifth-largest food company". Reuters. 25 March 2015. Retrieved 25 March 2015.
  15. ^ Primack, Dan (25 March 2015). "Is Buffett behind 3G Capital's $40 billion play for Kraft Foods?". Fortune. Retrieved 25 March 2015.
  16. ^ "Kraft Heinz Enters Into Agreement to Acquire Brazilian Food Company Hemmer". ir.kraftheinzcompany.com. 23 September 2021. Archived from the original on 2021-09-30. Retrieved 29 September 2021.
  17. ^ "Kraft Heinz Announces Agreement to Purchase Assan Foods, Headquartered in Istanbul, Turkey". ir.kraftheinzcompany.com. 11 June 2021. Archived from the original on 2021-06-13. Retrieved 29 September 2021.
  18. ^ "Restaurant Brands International Inc. Agrees to Acquire Popeyes Louisiana Kitchen". www.prnewswire.com (Press release). Retrieved 2023-06-05.
  19. ^ "Restaurant Brands International Inc. to Acquire Firehouse Subs". www.rbi.com. Retrieved 2023-06-05.
  20. ^ a b "About Us - Board of Directors - Person Details | Restaurant Brands International". www.rbi.com. Retrieved 2023-06-05.
  21. ^ Sorvino, Chloe. "Whopper Of A Turnaround: At Burger King, The 3G Capital Model Actually Worked". Forbes. Retrieved 2023-06-05.
  22. ^ Peterson, Hayley. "How a 36-year-old Wall Street prodigy saved Burger King". Business Insider. Retrieved 2023-06-05.
  23. ^ "About Us - Board of Directors - Person Details | Restaurant Brands International". www.rbi.com. Retrieved 2023-06-08.
  24. ^ "Restaurant Brands International Inc. Appoints Patrick Doyle as Executive Chairman to Accelerate Growth". www.rbi.com. Retrieved 2023-06-05.
  25. ^ "3G Capital Completes Acquisition of Controlling Interest in Hunter Douglas". Hunter Douglas IR. February 25, 2022. Retrieved June 12, 2022.
  26. ^ "3G Capital to acquire controlling interest in Hunter Douglas". www.prnewswire.com (Press release). Retrieved 2023-06-05.
  27. ^ "3G Capital quietly exited its Kraft Heinz investment last year". CNBC. 9 April 2024.
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