The cuts at Tim Hortons have begun!
Last year the iconic Canadian company Tim Hortons was bought by Burger King. Many people were worried about what kind of consequences it would have for the company and its stakeholders. And it looks like our fears are coming to life.
Burger King, which is controlled by a Brazilian private equity firm named 3G Capital, has already begun laying off staff at Tim Hortons’ corporate head offices. The business-friendly newspaper the Financial Post said that “tensions are running high” at Tim Hortons. The CBC reported that 350 people have already been laid off, nearly 20% of their head office employees.
This news didn’t surprise too many people. The Financial Post wrote 3G Capital is known to be a “ruthless streamliner” who made big cuts at Burger King and H.J. Heinz after they bought these companies. They didn’t expect Tim Hortons to be any different.
Burger King claims buying Tim Horton’s will help expand the donut company’s operations in the US market. Tim Hortons has tried to penetrate the American market but its efforts have stalled many times. If the expansion efforts don’t work out as planned this time around, 3G Capital might be tempted to begin squeezing the Canadian company by selling off Tim Hortons’ manufacturing and distribution centres. That means even more Canadian jobs will be lost.
It’s hard to see how Canadians will benefit from this merger. No one is really sure if 3G Capital has Tim Hortons best interests at heart. It will do anything it can to make sure it’s profits are upheld – even if it means stripping the company of everything its worth.