Bloomberg News

Restaurant Brands International Inc. agreed to buy Popeyes Louisiana Kitchen Inc. (Nasdaq: PLKI) for about $1.8 billion, adding a fried-chicken chain to its lineup of burgers and doughnuts.

The cash offer of $79 a share represents a 19 percent premium to Popeyes’ closing price on Feb. 17. The deal is expected to close by early April, the companies said.

The acquisition would be the first major deal for Restaurant Brands, which was formed in the 2014 merger of Burger King and Tim Hortons. The company’s managers have long said they would consider taking over other brands, where they could boost profit by cutting costs and selling locations to franchisees. Restaurant Brands, backed by Brazilian private equity firm 3G Capital, also may look to expand the chain abroad.

“Restaurant Brands may be able to cut selling, general and administrative expenses in half in the next two years, and its private equity partners can boost international expansion as spicy flavors, chicken and rice tend to travel well,” said Michael Halen, an analyst at Bloomberg Intelligence. “It fits right into the 3G playbook.”

Popeyes, which has more than 2,600 restaurants in the U.S. and 25 other countries, has performed well lately, with the stock gaining for eight years in a row. Chief executive officer Cheryl Bachelder has improved relationships with franchisees, sped up service times and played up the brand’s New Orleans heritage with foods such as Magnolia Blossom Chicken. The chain will continue to be independently managed in the U.S., Restaurants Brands said.

The transaction is being paid for with cash on hand and a financing commitment from JPMorgan Chase & Co.  (NYSE: JPM) and Wells Fargo & Co. (NYSE: WFC).  The company was advised by Paul, Weiss, Rifkind, Wharton & Garrison. Popeyes received financial advice from UBS AG and Genesis Capital and got legal counsel from King & Spalding.

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