Yum! Brands to sell Pizza Hut operations in $2.7b deal

Yum!’s board approved the deals, which are expected to close in the third quarter of 2026.

Yum! Brands, Inc. has agreed to sell Pizza Hut for a combined $2.7b, with separate buyers acquiring the chain’s operations outside Mainland China and in China.

Private equity firm LongRange Capital will acquire Pizza Hut’s business outside Mainland China for about $1.5b.

The deal also includes a potential $75m earn-out payment to Yum Brands by 2030, depending on performance.

Pizza Hut China will be sold to Yum China Holdings Inc. for about $1.2b.

“These transactions enable Yum! to be a more focused company that continues to leverage scale, technology, and talent to accelerate our raising the B.A.R. priorities and deliver sustained value for our stakeholders,” said Chris Turner, CEO of Yum! Brands.

“Under LongRange and Yum China, Pizza Hut will be well-positioned for future growth with ownership that brings deep expertise in the restaurant industry,” he added.

Yum! Brands said it expects to receive about $2.3b in after-tax proceeds from the transactions, after accounting for taxes, closing adjustments, and transaction-related fees.

The company expects to spend about $85m in one-time costs through the remainder of 2026 to complete the separation.

The company will continue providing its Byte by Yum! technology platform to Pizza Hut locations outside China and will provide certain corporate services during the transition period.

Yum! said fees from those services in 2026 are expected to offset corporate costs previously assigned to the Pizza Hut division.

Yum!’s board unanimously approved the transactions, which are expected to close in the third quarter of 2026 pending regulatory approvals and other closing requirements.

After the deals are completed, Yum! will no longer report Pizza Hut as a separate business division.

The company said it plans to use the proceeds under its capital allocation strategy, including investments in its operations and returning additional capital to shareholders.

Alongside the deal approval, Yum!’s board authorised an additional $4b for share repurchases.

Yum! management is expected to provide more details on the financial impact of the transactions and any changes to its 2026 outlook during its second-quarter earnings call on 30 July.