Yum China takes full control of Pizza Hut China in $1.2b acquisition

Plans to expand Pizza Hut to over 6,000 stores by 2028.

Yum China Holdings, Inc. has agreed to acquire full ownership of the Pizza Hut brand in Mainland China from Yum! Brands, Inc. for $1.2b in cash.

Once completed, Pizza Hut China will stop paying brand licensing fees to Yum! Brands.

Yum China said the deal strengthens its control over Pizza Hut operations and supports faster growth, with plans to expand from 4,375 stores to more than 6,000 by 2028 and double operating profit by 2029 versus 2024.

In 2025, Pizza Hut China generated $2.3b in revenue and $183m in operating profit. The business has posted 13 straight quarters of same-store transaction growth and continued margin expansion into 2026.

CEO Joey Wat said full ownership will allow faster menu and store innovation and improve profitability by removing licensing costs.

"Moving from the exclusive licensee to the brand owner of Pizza Hut in Mainland China represents a transformative milestone for us, demonstrating our conviction and long-term commitment to the China market,” he said. “We see tremendous opportunities ahead, and we are still only at the early stage of our planned growth trajectory for Pizza Hut China.”

The company said the acquisition is expected to close in Q3 2026 and be immediately accretive to earnings starting that year.

Yum China confirmed it will continue its partnership with Yum! Brands on the KFC business, which will remain its main growth driver. KFC China plans to expand from 13,454 to over 17,000 stores by 2028.

The deal will be funded through cash and debt. Yum China also reaffirmed its shareholder return plan, including $1.5 billion in 2026 and ongoing payouts tied to free cash flow from 2027 onward.

Advisers include Lazard Ltd, Sidley Austin LLP, and Fangda Partners.