Yum! Brands, the parent company of KFC and Taco Bell, has sold the historic Pizza Hut franchise to LongRange Capital for US$1.5 billion. The divestment follows several years of disappointing sales performance.
Under the agreement, approximately 15,600 Pizza Hut outlets in more than 100 countries will transfer to the new owner. The transaction excludes Pizza Hut’s Chinese business, which includes over 4,300 restaurants and will continue operating separately under Yum China Holdings.
The sale ends nearly three decades of Pizza Hut ownership by Yum! Brands, the company formed when PepsiCo spun off its restaurant division in 1997. It also completes the wider break-up of Pizza Hut’s global operations, valued at around £2 billion after the China division was sold for $1.2 billion.
The deal reflects broader food and beverage industry trends, including portfolio consolidation, changing food and drink consumer trends and the growing importance of food and drink innovation. Restaurant groups are increasingly assessing brand performance alongside food manufacturing trends, food distribution trends and shifts in food and drink marketing.
Yum! Brands could still receive an additional $75 million if Pizza Hut achieves performance milestones that have not been disclosed by 2030.
Headquartered in Plano, Texas, Pizza Hut has faced sustained financial pressure and failed to match the strong expansion delivered by sister brands KFC and Taco Bell. Those results encouraged Yum! Brands to undertake a strategic review of its portfolio.
Pizza Hut nevertheless retains a substantial international footprint and remains, by a significant margin, the world’s second-largest pizza franchise. Its future performance will depend on how effectively the business responds to evolving food processing technology, food and drink packaging expectations, food and drink sustainability priorities and food and drink regulations across its markets.
“With this transaction complete, Yum! Brands now moves forward as a more focused company with significant opportunities for growth around the world,” said CEO Chris Turner, Yum! Brands.
“Our unmatched digital capabilities and scale and our relentless focus on the future consumer, strengthening restaurant economics and leveraging Byte by Yum! will allow us to accelerate growth and deliver sustainable long-term value for our shareholders.”
