Yum Brands Enters Second Round Of Bidding For Stake In Yum China Ahead Of Spinoff

Last October, Yum Brands(YUM) finally agreed to spin off its China business under pressure from investors including Keith Meister of Corvex Management. Corvex owns 5.2% of Yum, and Meister sits on the board. Yum, parent of brands including Pizza Hut, KFC, and Taco Bell, has 7,205 restaurants in China which collectively earn over $1 billion each year.

Currently, Yum is selling a minority stake of around 20% of Yum China and three bidders are believed to have made it to the second round.

Singapore state investor Temasek Holdings and a consortium that includes China Investment Corp (CIC) and KKR & Co (KKR) have advanced to a second round of bidding for a minority stake in Yum Brands Inc’s  China unit, people familiar with the matter told Reuters.

Another private equity-backed consortium has also moved to the second round, the people said, although its identity could not be immediately confirmed.

The entire unit is believed to be worth between $8 and $11 billion. Following the sale, Yum plans to spin off the business to shareholders by the end of 2016.

Disclosure: The author holds no position in any stock mentioned