It has been nine months since it was announced on March 31st, 216 that it would introduce strategic investors. Today (January 9th), McDonald's China was finally sold to CITIC, CITIC Capital and American private equity fund Carlyle for US$ 2.8 billion.
At noon today, CITIC announced on the Hong Kong Stock Exchange that CITIC, CITIC Capital, Carlyle and McDonald's have reached a strategic cooperation and established a new company, which will become the main franchisee of McDonald's in China and Hong Kong in the next 2 years. It is reported that the new company will acquire McDonald's business in mainland China and Hongkong for a total consideration of up to US$ 2.8 billion (about HK$ 16.14 billion). The purchase consideration will be partially settled by cash and partially by issuing new shares of the new company to McDonald's. After the transaction is completed, CITIC and CITIC Capital will hold 52% of the controlling shares in the new company, while Carlyle and McDonald's will hold 28% and 2% respectively.
The new company expects to open more than 1,5 new restaurants in the next five years and turn more than 1,75 direct-operated restaurants into franchises. The announcement shows that the new company will further develop McDonald's business, including opening new restaurants (especially in third-and fourth-tier cities), increasing the sales of existing restaurants, and expanding and upgrading in menu innovation, convenient service, digital retail and take-away.
Previously, in 215, McDonald's stated that it would turn 4, restaurants into franchise restaurants by the end of 218, and its long-term goal was that 95% of restaurants were franchise restaurants. After the completion of this transaction, more than 1,75 McDonald's restaurants in mainland China and Hongkong will be franchised. As of December 31st, 216, McDonald's has more than 2,4 direct-operated and franchised restaurants in mainland China and more than 24 restaurants in Hong Kong.
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According to the Beijing Times, Yum! Brands, which owns KFC and Pizza Hut, spun off its business in China and listed on the NYSE in November 216. Investors introduced by Yum! China are Chunhua Capital operated by Hu Zuliu, the former chairman of Goldman Sachs Greater China, and Ant Financial, a subsidiary of Alibaba Jack Ma. The two parties jointly invested 46 million US dollars to acquire part of the shares of Yum! China Holdings. At present, the market value of Yum! China is about $1.8 billion. Obviously, the controlling stake of Yum! China is still in the hands of Yum! Group. Hot drinks mixed with disinfectant. How did father and son get into McDonald's dining poisoning? See details on Sina News
Different from Yum!' s divestiture of China Company, McDonald's China has sold the main management right in China market, but the notice shows that the acquirer can only become the main franchisee of McDonald's in mainland China and Hongkong in the next 2 years. According to Caixin, from a global perspective, McDonald's is ahead of KFC. At present, McDonald's has more than 3, stores in 121 countries and regions; KFC (including Pizza Hut) has about 11, chain stores in 8 countries and regions, only one third of McDonald's. McDonald's global revenue is basically twice that of KFC, and its profit is three to four times that of KFC. "patriotic youth" questioned that boycotting KFC was irrational and patriotic, and was beaten by the boycotters. Open Sina News for details
But this power contrast has been upside down in the China market. KFC and Pizza Hut both belong to Yum (NYSE：YUM), and its main business unit in China is Yum's China division. Yum! China has 8,2 restaurants, including nearly 5, KFC stores and nearly 3, Pizza Hut. The total number of McDonald's stores in mainland China is only 2,4, which is less than one third of that of Yum! China. The two companies consume about 1 billion chickens a year in China market, including 64 million chickens from KFC and 36 million chickens from McDonald's. 35, people in the United States petitioned KFC to stop using antibiotic chicken and open Sina News. Food safety issues have no borders
Yum! China's revenue and profits accounted for half of Yum! Group for a long time, with a higher proportion in the peak period of 212; The China part of McDonald's accounts for only 5% of its global business, and its profit is almost negligible. In addition, according to the previous report of Observer.com, McDonald's sales were greatly reduced due to the exposure of suppliers' use of expired chicken in the summer of 214. With the improvement of the income level of consumers in China, they are being robbed of customers by local capital catering chains and foreign coffee chains recently.
In addition, McDonald's in the United States is also facing the problem of slow growth. From July to September 216, the financial report showed that the profit continued to decrease, and the net profit decreased by 3% compared with the same period of the previous year. It is shifting from a direct store with higher cost to an external franchise. The woman was invited to eat KFC, and was deeply moved and sexually assaulted. Open the video to watch the tragedy caused by KFC.
Whether the sale of the main franchise can bring a turn for the better for McDonald's operation in China is worthy of attention.
however, Steve Easterbrook, CEO of McDonald's, said that there are huge business opportunities in China and Hongkong. Our partners have excellent performance and have a comprehensive understanding of the China market. The joint efforts of all parties can further enhance competitiveness, realize rapid business growth, and make McDonald's a leading fast food enterprise in China Mainland and Hongkong.