Hillhouse Capital and KKR & Co are among firms exploring a potential acquisition of Yum China Holdings Inc (百勝中國控股), the US$14 billion US-listed operator of KFC and Pizza Hut brands in China, people familiar with the matter said.
The private equity firms are talking to banks about financing for a possible deal, said the people, who asked not to be identified because details are private.
Potential suitors could seek to form a consortium to jointly bid for the business, the people said.
Yum China shares rose 11 percent in US trading on Thursday, the most since its 2016 listing, after The Information reported Hillhouse’s interest, citing unidentified people.
Yum Brands Inc spun out the Chinese business less than two years ago after losing market share amid changing tastes and increased local competition in the world’s most populous country.
The Shanghai-based firm has struggled to attract younger diners to its Pizza Hut restaurants, despite overhauling its mobile app, upgrading its menu and enlisting celebrities to tout the US brand.
Deliberations about any potential bids are at an early stage, and they may not result in a deal, the people said. Representatives for Hillhouse and KKR declined to comment.
An external representative for Yum China said in an e-mail that the company does not comment on rumors or market speculation “regarding these sorts of matters.”
McDonald’s Corp agreed to sell a controlling stake in its China and Hong Kong operations last year for about US$1.7 billion. Chinese state-backed conglomerate Citic Ltd (中信股份), Citic Capital Holdings Ltd (中信資本控股) and US private-equity firm Carlyle Group LP bought an 80 percent holding that valued the business at as much as US$2.08 billion.
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to