Yum Brands to spin-off China business

Yum Brands, the company behind KFC, Taco Bell and Pizza Hut, has plans to spin off its business in China into a separate publicly-traded company by the end of 2016.

Yum China, which brought in nearly $6.9 billion in revenue last year, will become a franchisee of Yum Brands and will operate under a franchise agreement. They will have exclusive rights to three category-leading brands: KFC, China’s leading quick-service restaurant, Pizza Hut, the leading casual dining brand and Taco Bell, which is not yet in China. Yum Brands believes the move will help the China unit grow from its current 6,900 restaurants to more than 20,000 in the future.

According to the company, the remaining Yum Brands business outside of China will concentrate on becoming more of a franchisor, with the goal of having at least 95% of its restaurants owned and operated by franchisees by the end of 2017.