Yum! buys into Little Sheep
By Ding Qingfen | China Daily | Updated: 2009-03-26 07:48
Yum! Brands Inc, the US catering group, said yesterday it agreed to buy a 20 percent stake in Inner Mongolia Little Sheep, China's leading hot-pot chain operator, for $63 million, becoming the second-largest shareholder in Little Sheep.
This is the first investment deal for Yum! in China's catering industry, and presents win-win benefits for both sides, said insiders close to the deal.
Yum! will buy a 13.92 percent stake from UK-based venture capital firm 3i and the US' Prax Capital, and another 6.07 percent from Little Sheep's stake holders including its Chairman Zhang Gang, at a price of HK$2.4 per share, or an 8.4 percent discount to its closing price of HK$2.62 on Tuesday. The deal is expected to be completed this summer.
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