Brazil's Rise Comes With A Burger and Fries

Private equity fund 3G agreed to buy Burger King on Thursday, in a deal valued at $4 billion. That makes 3G, controlled by a group of well-heeled Brazilians, the buyer of the most expensive fast food chain ever sold. 3G is said to be interested in expanding the burger giant’s presence in Latin America and Asia.

To some, such moves of American icon brands may hark to the day when Japanese companies bought about everything they could find in the continental 48. However, Brazil’s rise should be soothing to American investors, and patriots alike. 3G has a history of buying companies that focus on mass consumption. Consumption in Brazil is on the rise, as it is in much of Latin America, good news for those worried that there aren’t enough consumers among China’s 1.3 billion inhabitants to buy American goods.

Home ownership is growing rapidly in Brazil, new home and commercial construction is taking off, and consumer credit has expanded by more than 20 percent annually since 2002. 3G’s appetite for a whopper and fries points to an expanding menu of American goods likely to be ordered in the coming years. If Brazilians want to take the companies that go with it, that should be okay, too. “The King” can’t rival the Golden Arches, if my opinion counts, and its business in the U.S. has been sagging in recent years anyway.