HONG KONG (Reuters) - Investment firms are exploring a buyout of Yum China Holdings Inc. (YUMC.N) in what could be one of Asia’s biggest M&A deals this year, sources close to the situation told Reuters.
People celebrate Yum China listing on the NYSE in Shanghai, China November 1, 2016. REUTERS/Aly Song
Yum China, which had a market cap of $13 billion as of its closing price on Monday, was spun off from the KFC and Pizza Hut owner Yum Brands! Inc (YUM.N) in 2016 and later listed on the New York Stock Exchange.
The firm itself has been discussing internally about switching to the Hong Kong bourse for a listing, because of the city’s proximity to the Chinese market, potentially higher valuation and its convenient timezone for executives, a separate source with knowledge of the plan told Reuters.
Chinese investment firm Hillhouse Capital Group is planning to lead a consortium to buy the KFC and Pizza Hut operator in China, said four of the people. The firm, which has received commitments of over $10 billion for a new fund, has tapped lenders for potential financing of the deal and other investors to join them in the bid, two of them said.
Yum China’s shares rose as much as 7 percent on Monday.
Global investment house KKR & Co (KKR.N) and Hong Kong-based regional firm Baring Private equity Asia are also weighing up investing in the buyout, according to two sources, who added that no final decision has been made.
Bloomberg first reported on investors
