Burger King in talks to buy Canada's Tim Hortons

Burger King says it is in takeover talks with Canadian coffee and doughnut chain Tim Hortons.

A deal would create the world's third-largest fast-food combine, with a market cap of around 18-billion US dollars.

The new group would be based in Canada, which has lower overall corporate taxes than the United States.

So-called "tax inversion" deals are attracting increasing criticism in the US, where President Barack Obama has been looking into how they can be prevented in future.

Both shares in Burger King and Tim Hortons have spiked around 20-percent following the news.