News

Yum! proposes offer to buy China restaurant chain

April 25, 2011

Louisville, Ky.-based Yum! Brands has submitted a preliminary proposal to Baotou, Inner Mongolia, China-based Little Sheep Group Limited, which owns and operates Hot Pot concept restaurants throughout the country.

Yum! Brands' offer includes the acquisition of all outstanding shares of Little Sheep, other than a minority interest to be held by the chairman and other founding shareholders. Little Sheep's shares are listed on the Hong Kong Stock Exchange.

Yum! currently owns 27.2 percent of the outstanding shares of Little Sheep. No formal offer has been made and any such offer, should one be made, would be done so only after Yum! has obtained all necessary regulatory approvals for the transaction.

There is no guarantee this offer will result in a completed transaction.

Yum! has opened a staggering number of new units in China within the past couple of years. In 2010, the company opened more than 3,000 KFC restaurants and 500 Pizza Hut units. China has been a major boon for the company, helping boost its 2010 EPS growth by 17 percent.