Fast-food giant McDonald’s Corp. has reached a pact to sell most of its China- and Hong Kong–based operations to Chic, the Chinese state-backed entity, along with Carlyle Group for as much $2.1 billion.
Reuters reported Monday (Jan. 9) that the deal, which stretches out over 20 years, will look to help McDonald’s expand “rapidly” without having to draw down significant amounts of its own capital. The pact ties in with the local partners in a manner that would enhance growth for the company in Asia, with an eye on smaller cities.
The ownership structure shakes out to 32 percent for Citic and affiliate Citic Capital coming in with another 20 percent ownership. Carlyle gets 28 percent of the business and McDonald’s 20 percent.
All told, McDonald’s has 2,400 restaurants across the mainland, with another 240 locations based in Hong Kong. Targets are for another 1,500 restaurants to be added over the next half year. The company had said earlier in the year that it was looking to link up with strategic partners in the region. Bidders had included TPG, in tandem with Wumart Stores.
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