Yum China to acquire dining franchise business

Yum China Holdings said it has entered into a definitive agreement to acquire a controlling interest in the Huang Ji Huang group, a major Chinese-style casual dining franchise business. Subject to the satisfaction of closing conditions and regulatory approvals, the transaction is expected to close in early 2020, said Yum China. 

Founded in 2004 and headquartered in Beijing, Huang Ji Huang has over 640 restaurants in China and internationally. The group operates primarily under a franchise model and its brand portfolio consists of "Huang Ji Huang," a popular simmer pot brand, as well as "San Fen Bao," a newly launched Chinese fast food concept in China.

Yum China is reportedly the largest restaurant company in China, with over 8,700 restaurants as of June 30, 2019. With the addition of Huang Ji Huang, Yum China said it aims to gain a stronger foothold and enhanced know-how in the Chinese dining space, which represents a significant share of the dining market in China. In addition, with Yum China's scale and system capabilities, and Huang Ji Huang's track record of product R&D and brand management, the acquisition is expected to create synergies.