Yum Brands is selling a stake in its China business for $460 million
Fri Sep 02 2016
Nikki Bailey (1044 articles)

Yum Brands is selling a stake in its China business for $460 million

KFC and Pizza Hut owner Yum Brands yum said Chinese investment firm Primavera Capital and an affiliate of Alibaba Group Holding baba will buy a stake in Yum China for $ 460 million as part of a planned spinoff of the business.

Primavera will invest $ 410 million and Ant Financial, which runs Alibaba’s Alipay mobile payments platform, $ 50 million, Yum Brands said on Friday.

The spinoff and completion of the Primavera and Ant Financial investments are expected on Oct. 31, with Yum China to begin trading on the New York Stock Exchange as an independent company on Nov. 1.

Primavera and Ant Financial will buy the shares at an 8% discount to the average price at which Yum China’s shares trade between 31 days and 60 days after they are distributed to Yum shareholders.

Both companies will receive warrants to buy about 2% stakes in Yum China twice at valuation thresholds of $ 12 billion and $ 15 billion, the company said. The warrants will have a five-year term.

Nikki Bailey

Nikki Bailey

Nikki Bailey reports on US Stocks. She covers also economy and related aspects. She has been tracking US Stock markets for several years now. She is based in New York

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