You’d almost think folks in Chicago don’t know how to run a hamburger restaurant.
Friday’s news that an investment bank based in that Midwestern city — which, by the way, is also home to McDonald’s — had acquired a majority stake in the Texas born-and-bred Whataburger chain seemed to take away the appetites of many East Texans.
“Oh no! There goes the Texas best right out the window,” said Shannon Kay Ebarb, a Carthage resident who commented after the news was posted at news-journal.com. “Those folks in Chicago have no idea how we do things.”
Longview resident Matt Williams put it this way: “That’s like saying a Texas barbecue sauce is made in Chicago.”
And this simple demand came from Greg Branch, also of Longview: “Don’t Chicago our Whataburger.”
Fans should know all is not lost. The chain will remain based in San Antonio and BDT Capital Partners, along with members of the family that founded Whataburger, will “begin exploring expansion plans,” they said in a statement.
Growth is necessary to survive in today’s increasingly competitive fast-food market.
Whataburger’s founders, the Dobson family, will retain a minority position. President and CEO Preston Atkinson and board Chairman Tom Dobson will keep their seats on the board, but retire from daily operations. Other terms of the deal were not disclosed.
The decision “is both exciting and bittersweet” for the family, Tom Dobson said.
“Whataburger has been the heart and soul of our family legacy for nearly 70 years, but we feel really good about the partnership with BDT,” he said. “They have a track record of success with businesses as special as ours that want to grow, while preserving culture and family history. ... They have a tremendous reputation for doing the right thing.”
In addition to Whataburger, BDT has also invested in Krispy Kreme Doughnuts and Panera Bread, among others.
Ed Nelson, Whataburger’s chief financial officer and controller, will become president. Several other company executives also are being promoted.
“Whataburger has grown significantly over the years. And, in order to keep satisfying our customers, we’ve been exploring different options to expand the brand and introduce it to new audiences,” Atkinson said. “We’ve gone through this process purposefully and diligently because we wanted to find a partner who honors our values, culture and 69-year legacy of family tradition.”
Whataburger confirmed last month it had hired investment banking firm Morgan Stanley to help the company figure out how best to fuel its expansion. Friday’s announcement was a result of that exploration.
It’s the latest chapter for the burger chain that was founded by Harmon Dobson and Paul Burton in 1950 in Corpus Christi, where it operated for six decades.
By 2008, the company had outgrown its Corpus Christi headquarters. Whataburger executives also were increasingly nervous about the damage wrought by recent hurricanes on the Texas coast. It had to shut down its Corpus Christi operations more than once because of storms, and set up temporary headquarters in San Antonio.
Lured as well by San Antonio’s larger workforce, in 2009 Whataburger moved its headquarters to the city.
Over the years, it has cemented its place as a Texas icon with fiercely devoted fans.
Whataburger has used that following to branch into other ventures. In 2013, it teamed with San Antonio grocer H-E-B to sell its fancy and spicy ketchups, pancake mix and Whatafries and other products on the retailer’s shelves.
The brand also has spilled into Texas politics. Last year, it unwittingly became a fixture of former U.S. Rep. Beto O’Rourke’s failed bid to unseat U.S. Sen. Ted Cruz as the Democratic candidate live-streamed himself skateboarding one of the chain’s parking lots, speaking with restaurant customers or going on drive-thru runs after televised debates.
O’Rourke’s co-opting of the chain led a Cruz spokeswoman to label the El Paso congressman a “Triple Meat Whataburger liberal” — a move that drew mockery on social media.
In 2001, the state Legislature declared the company an official Texas Treasure.
The company operates more than 820 locations, with more than 670 in Texas alone. Whataburger’s other locations are in the South and Southwest, including Alabama, Arizona, Arkansas, Florida, Georgia, Louisiana, Mississippi, New Mexico and Oklahoma.
Most of its restaurants are company-owned, but that would change if Whataburger re-franchised the bulk of the chain, reflecting a trend playing out in the fast food industry.
Whataburger is the second Texas-born company to be sold this week. On Thursday, the family that built Schlitterbahn into a national brand sold two of its three Texas water parks to an Ohio theme park operator for $261 million.