According to the Wall Street Journal, Yum! Brands, which owns big name fast-food franchises KFC, Pizza Hut and Taco Bell, is considering selling a minority stake in their China operations. This is potentially part of the fast-food giant’s overall strategy to franchise off their once booming China business unit.

According to sources familiar with the plan, Yum! has started discussions with several financing companies about selling a large stake—possibly nearly 20% and approximately valued at 10 billion USD—in their China business.

Those familiar with the plan also noted that interested buyers include private equity companies KKR and Baring Private Equity Asia, as well as several other Chinese investors. Potential investors have posed several options to Yum, according to the unnamed source, but Yum! appeared to be largely intent on selling 19.9% stake of their China operations, in order to avoid a big tax bill. Potential investors are said to likely form one or more investment groups to contend for the bid.

Yum! is estimated to have a market worth of 32 billion USD. The company unveiled their plans to franchise off their China businesses last October. This move was intended to stave off negative factors that have plagued Yum!’s China operations, including food safety scandals, tougher competition and other issues. As part of the plan, businesses will pay Yum! a franchise fee for KFC, Pizza Hut and Taco Bell operations.

Source: inews.qq.com

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Keywords: Yum sells stake in China business fast-food chains