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Don't Mess With Whataburger, Texans Tell Chicago Investor

Chicago-based investor BDT Capital Partners has acquired a majority stake in the growing San Antonio-based hamburger chain Whataburger from the Dobsons, the Texas family who founded the company nearly 70 years ago. 


The change of ownership, according to the company, will provide the capital needed to grow the brand from a regional player into a national one. BDT didn't reveal how much it paid for its stake, but a source cited by Reuters when Whataburger was exploring a sale posited a valuation of $6B for the company.

Whataburger is the sixth-largest U.S. burger chain based on 2018 sales, according to QSR. While most heavily concentrated in Texas, Whataburger has locations in nine other states, with 828 restaurants all together, an increase of about 15% from a year ago. The chain enjoyed sales of about $2.2B in 2018, but not the kind of national recognition that other (yet smaller) growing chains enjoy, such as Shake Shack and In-N-Out Burger.

Still, distinctive touches, such as its five-inch burger buns, massive shakes, and being open 24 hours a day, have helped the brand gain a devoted following in Texas, and the prospect of non-Texas owners for the beloved orange-and-white, peaked-roof hamburger stands touched off a flurry of worry and a measure of outrage among Texans. 

Houston Texans star J.J. Watt notably tweeted a call for a buyback of the chain. "Ok, I say we all chip in and buy Whataburger back," Watt said.

Since it is only a tweet, it isn't clear how serious Watt is. The football player has a history of successful fundraising, however. Watt raised more than $37M for victims of Hurricane Harvey, and was awarded the 2017 Walter Payton NFL Man of the Year Award for his efforts.

Other tweets mentioned a different kind of action regarding Whataburger.

Whataburger was quick to try to reassure its large fan base in Texas that nothing about the restaurants is going to change, even under out-of-state ownership, and even as the brand expands.

BDT is a merchant banking firm established in 2009 by Byron Trott, a former vice chairman of investment banking at Goldman Sachs. The company specializes in investments in family-owned businesses looking for growth, but has also made real estate investments. For much of the 2010s, BDT led a group of investors that owned Chicago's famed Wrigley Building.