Does it matter if Canadians own Tim Hortons?
Wendy's purchased Tim Hortons in 1995 for $580-million
So, Tim Hortons is owned by an American corporate burger giant. Would you like fries with that double double? Does it matter to Canadians?
In the wake of $12.5-billion (U.S.) merger deal in which Burger King and Tim Hortons will combine for what’s being billed as the third-largest fast food company in the world, CBC Radio asked its listeners what that means to the average Joe when buying their cup of Joe.
“It's worth remembering what Canadians will tolerate (foreign ownership),” said Douglas Hunter, author of “Double Double: How Tim Hortons Became a Canadian Way of Life, One Cup at a Time.”
“We don't even have a major brewery anymore that is Canadian-owned,” said Hunter. “They're owned in Brazil, they’re owned in Japan, they're owned in Belgium. Molson still manages to do the Molson Canadian thing even though it's not Molson of Montreal anymore.”
“We have a tolerance, we have an understanding that large international corporations can end up owning Canadian icons.”
Callers in to the CBC radio show Ontario Today were split on where they stood on the coffee and donuts debate. What was clear is that how much of Tim’s is still Canadian, by ownership and now image, was not well known among callers.
Tim Hortons had previously been under U.S. ownership during the years it was owned by Wendy’s. The burger chain purchased the iconic donut shop in 1995 for $580-million, before going public in 2006. Under the Wendy’s ownership, Tim’s centralized its baking in 2001 at Maidstone Bakeries – a company they owned, and then sold to Swiss investors in 2010.
All told, some parts of Tim’s has been foreign-owned for a long time.
Bernie Wolf, a professor of economics and international business at York University’s Schulich School of Business said it’s a good deal for Canadians, who will reap the benefits of a combined 23-billion in business when the merged company is incorporated in Canada.
“I think it's a very good deal,” Wolf told Ontario Today. He said the savings in corporate tax for companies in the U.S. versus Canada is 8.5 per cent, a “substantial difference” and main reason behind the move.
“The new company, it's still going to be owned, 20%, by Tim Hortons shareholders. So (Canada gets) the tax revenue, still get to own some of the shares, Tim Hortons probably prospers more by this deal. So I think its pretty much a winning combination,” Wolf said.