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Burger King is in merger talks with Canadian coffee chain Tim Hortons, a deal that would allow the burger seller to relocate out of the U.S. and possibly cut its tax bill.
The new company would be headquartered in Canada, the two firms said in a joint statement. Both Tim Hortons (THI) and Burger King (BKW) would continue to operate as standalone brands.
By moving north of the border, Burger King would be completing what is called an "inversion" -- a strategy that allows U.S. firms to lower their tax bills by merging with a foreign company, and then relocating to the new country.
Corporate tax rates are lower in Canada than the U.S., which has the highest tax rate among developed economies.
In the case of Miami-based Burger King and Tim Hortons, the combined company would be the world's third largest fast food chain, generating $22 billion in sales at more than 18,000 restaurants in 100 countries worldwide.
Is Burger King moving to Canada?