Vogo Fund to acquire Burger King unit from SRS Korea for $88m

South Korean private equity fund Vogo Fund will take over the local chain of Burger King from franchise restaurant operator SRS Korea Co. for about 100 billion won ($88.7 million) this year, industry sources said Thursday.

According to the sources, the local fund has completed negotiations to buy the chain of global fast food restaurant Burger King in South Korea with Doosan Group that has SRS Korea under its wing and will sign a preliminary deal for the acquisition some time soon.

The deal is expected to be completed within this year, the sources said.

Vogo Fund had originally planned to buy the chain of another global fast food restaurant, KFC, in the country along with the Burger King chain but excluded it from its takeover list, the sources said.

SRS Korea, the owner of KFC and Burger King chains in South Korea, was established in 2004, after Doosan Group spun off its food service division as part of its efforts to ease a credit crunch.

The group suffered a cash shortage since Doosan Infracore International, the U.S. unit of its affiliate Doosan Infracore Co., acquired U.S.-based construction equipment maker Bobcat for $4.9 billion in November 2007. Doosan Infracore is South Korea’s largest construction-equipment maker.

In June 2009, the group made public its restructuring plan, including the sale of its three affiliates ― bottle-cap maker Samhwa Crown & Closure Co., defense equipment manufacturer Doosan DST Co. and SRS Korea.

“When the sale of Burger King chain is completed, we will also dispose of the KFC chain,” said an official at the group, adding, “We decided to get rid of the food service business from our business portfolio a long time ago.” (Yonhap News)