Yum China sells $460m stake to Primavera, Ant Financial

Yum Brands Friday said it has reached a deal to sell a 460 million U.S. dollar stake in its China business to private equity firm Primavera Capital and online and mobile financial service provider Ant Financial.

The owner of KFC, Pizza Hut and Taco Bell said the deal and spin-off of its China business are expected to be completed on Oct. 31. Shares of Yum China will start trading on the New York Stock Exchange on Nov. 1.

According to the deal, China-based Primavera Capital invests 410 million U.S. dollars while Alibaba's financial affiliate invests 50 million U.S. dollars.

The two will get an eight-percent discount on the average share price of Yum China during the second 30 trading days.

The two also can buy a two percent stake in Yum China twice during the next five years at a valuation of 12 billion U.S. dollars and 15 billion U.S. dollars, respectively.

Yum Brands also said Primavera Capital founder Fred Hu will become non-executive chairman of Yum China.

The construction of more transport hubs, shopping malls and other infrastructure in towns and cities will lead to strong growth in the retail and catering industries in China, said Hu.

Micky Pant, chief executive officer of Yum China, said the investment showed the confidence in the market strategy and growth potential of the China division.

Yum China runs more than 7,200 KFC and Pizza Hut restaurants in over 1,000 cities in China, contributing to half of Yum's global revenues.

Sourc : XINHUA