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August 23, 2019

Yum China to acquire controlling stake in China’s Huang Ji Huang

Fast food restaurant company Yum China Holdings has agreed to purchase a controlling stake in Chinese-style casual dining franchise business Huang Ji Huang.

Fast food restaurant company Yum China Holdings has agreed to purchase a controlling stake in Chinese-style casual dining franchise business Huang Ji Huang.

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While wanting to protect the country from being overwhelmed by Omicron, China’s adherence to a Zero-COVID policy is resulting in a significant economic downturn. COVID outbreaks in Shanghai, Beijing and many other Chinese cities will impact 2022’s economic growth as consumers and businesses experience rolling lockdowns, leading to a slowdown in domestic and international supply chains. China’s Zero-COVID policy is having a demonstrable impact on consumer-facing industries. Access GlobalData’s new whitepaper, China in 2022: the impact of China’s Zero-COVID lockdowns on economic activity, consumer goods and the foodservice industry, to examine the current situation in Shanghai and other cities in China, to better understand the worst-affected industry sectors, foodservice in particular, and to explore potential growth opportunities as China recovers. The white paper covers:
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Established in 2004, Huang Ji Huang currently operates more than 640 restaurants through a franchise model in China and across the globe.

The company is headquartered in Beijing. Its brands include Huang Ji Huang simmer pot brand, and San Fen Bao Chinese fast food concept.

The acquisition is currently dependent on the satisfaction of closing conditions and receipt of regulatory approvals. Yum China expects to complete the transaction in early 2020.

Following the completion of the transaction, Yum China expects to achieve a stronger foothold and enhanced know-how in China’s dining market.

The acquisition is expected to create synergies for Yum China by combining its scale and system capabilities with Huang Ji Huang’s product research and development and brand management.

A Yum! Brands licensee, Yum China holds rights to quick-service restaurant brands KFC, Pizza Hut and Taco Bell in the country.

As at the end of June 2019, the company had over 8,700 restaurants operating in more than 1,300 cities. It also owns Little Sheep, East Dawning and COFFii & JOY concepts.

Last month, the restaurant franchisee reported total revenues of $2.12bn for the second quarter ending 30 June 2019.

In March this year, Yum China announced the expansion of its restaurant portfolio to 10,000 stores by 2021 as part of its growth strategy for this year.

Free Whitepaper
img

What is the impact of China’s Zero-COVID lockdowns on economic activity, consumer goods and the foodservice industry?

While wanting to protect the country from being overwhelmed by Omicron, China’s adherence to a Zero-COVID policy is resulting in a significant economic downturn. COVID outbreaks in Shanghai, Beijing and many other Chinese cities will impact 2022’s economic growth as consumers and businesses experience rolling lockdowns, leading to a slowdown in domestic and international supply chains. China’s Zero-COVID policy is having a demonstrable impact on consumer-facing industries. Access GlobalData’s new whitepaper, China in 2022: the impact of China’s Zero-COVID lockdowns on economic activity, consumer goods and the foodservice industry, to examine the current situation in Shanghai and other cities in China, to better understand the worst-affected industry sectors, foodservice in particular, and to explore potential growth opportunities as China recovers. The white paper covers:
  • Which multinational companies have been affected?
  • What is the effect of lockdowns on foodservice?
  • What is the effect of lockdowns on Chinese ports?
  • Spotlight on Shanghai: what is the situation there?
  • How have Chinese consumers reacted?
  • How might the Chinese government react?
  • What are the potential growth opportunities?
by GlobalData
Enter your details here to receive your free Whitepaper.

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