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Yum Brands plans to separate China business
[BENGALURU] Yum Brands Inc said it intended to separate its China business into a publicly traded company in a major reorganization of the fast-food company.
Yum China, the new entity, will become a franchise of Yum Brands in Mainland China, the company said.
Yum China will have exclusive rights to three of the company's brands - KFC, Pizza Hut and Taco Bell - in China, while Yum Brands will focus on expanding the chains around the world, the company said on Tuesday.
Upon completion of the separation, Yum Brands will be led by its current Chief Executive Greg Creed and Yum China will be led by Micky Pant, who was named the CEO of the China business in August.
The separation is expected to be completed by the end of 2016 and is intended to be tax free to shareholders.
Yum China has about 6,900 restaurants in over 1,000 cities.
The business remains on track to open about 700 new restaurants in 2015 and is targeting expansion to over 20,000 restaurants in China in the future, Yum Brands said.
Yum's shares rose nearly 5.3 per cent in premarket trading on Tuesday.