McDonald's in talks to sell China, Hong Kong and UK franchises for $3bn
McDonald's Corp has received more than half a dozen bids for its China and Hong Kong stores, including offers from Beijing Tourism Group, Sanpower and ChemChina, in an auction that could fetch up to $3billion, people familiar with the matter said.
Sanpower Group, a technology and real estate firm, said late on Wednesday it has submitted a joint bid with Beijing Tourism Group for the stores.
Buyout firms including Bain Capital, TPG Capital and Carlyle Group are also participating in the auction with a view to teaming up with Chinese strategic bidders, the people said.
The US fast food company announced in March it was reorganizing its Asian operations by bringing in partners who would own the restaurants within a franchise business. Competitor Yum Brands is also restructuring its China business by spinning it off ahead of a likely IPO next year.
McDonald's Corp has received more than half a dozen bids for its China and Hong Kong stores, including offers from Beijing Tourism Group, Sanpower and ChemChina, in an auction that could fetch up to $3billion, people familiar with the matter said
The planned sale of China units by McDonald's and Yum indicates they are seeking local partners who could help ward off growing competition from domestic rivals and also better manage public perception in the wake of food-safety scares that hit the two fast-food giants in the last few years.
'Given the difficulties Western chains have had recently with public perception, local players have become a serious competitive threat,' said Elizabeth Friend, consumer foodservice analyst at Euromonitor International.
pre bonded hairOak Brook, Illinois-based McDonald's has hired Morgan Stanley to run the sale of about 2,800 restaurants in China, Hong Kong and South Korea, Reuters previously reported. The sale in South Korea is being run separately and it was not known if the same parties have expressed interest in that sale, the people added.
As part of the deal, McDonald's is offering a 20-year master franchise agreement to buyers, with an option to extend it by another 10 years.
It has stipulated that private equity firms remain a minority partner in any bidding consortium, restrictions that discouraged some buyout funds from participating in the auction, the people added.
Among those who were preparing to place first-round bids ahead of the June 20 deadline were Beijing Capital Agribusiness Group, which is McDonald's current China partner, and GreenTree Hospitality, the people added. It was not immediately clear if they made the bids.
McDonald's will now draw up a shortlist of bidders for the next round in the coming weeks.
The US fast food company announced in March it was reorganising its Asian operations by bringing in partners who would own the restaurants within a franchise business
Privately held Beijing Tourism did not respond to a fresh Reuters request for comment on Thursday.
Officials at ChemChina, formally known as China National Chemical Corp, were not available to comment on Wednesday. An official at Beijing Capital Agribusiness said the company did not participate in the bidding. A spokeswoman for GreenTree said the company was not bidding currently.
Bain, Carlyle and TPG declined to comment. The sources declined to be identified as the sale process is confidential.
A McDonald's spokeswoman said the company was 'making progress' in the sale process. 'As no decisions have been made, it would be premature to speculate further,' she said in an email.
McDonald's does not break out country-by-country revenue details but industry data shows it is China's No. 2 fast food chain behind Yum, which operates the KFC and Pizza Hut chains.
remy hair extensionsMcDonald's China and Hong Kong business posted about $200million in earnings before interest, tax, depreciation and amortisation for fiscal 2016, and could be sold for about 15-16 times its core earnings, taking the deal value to about $3billion, one of the people said.
But its earnings have been volatile and it made only $65million for 2015, which is likely to weigh on how some of the suitors could value the business, the people added. Some sources said the sale is likely to fetch around $2billion.
Caitlyn Jenner's docu-series has officially been cancelled after two seasons.
The 66-year-old confirmed weeks of rumours that I Am Cait is coming to an end on her Twitter page on Tuesday.
'After 2 amazing seasons of @IAmCait, it's time for the next adventure,' Caitlyn shared. 'Thank you E! & thank you to the best girlfriends I could ask for!'
perruques cheveux naturelsComing to an end: Caitlyn Jenner (pictured last month) confirmed on Tuesday that I Am Cait has been cancelled after two seasons
The news doesn't come as a surprise following much speculation that the show would not return due to low ratings.
I Am Cait debuted strong in July of last year, with 2.73million viewers tuning in for the series premiere.
However the show failed to hold onto its audience in its second season.
Just 860,000 viewers watched the season two finale, with ratings dipping as low as 480,000 during the season.
'Thank you E!': The 66-year-old announced the news on her Twitter page and said 'it's time for the next adventure'
Sharing her story: The docu-series followed Caitlyn after her gender transition
'There just weren’t enough viewers,' a source told Radar Online earlier this month. 'The show can’t compete with other programming.'
E! released a statement shortly afterwards saying that 'no decision had been made' at that time regarding the future of the show.
I Am Cait followed the life of the Olympian, who was born Bruce, after her gender transition.
The series was announced by E! immediately after Caitlyn's 20/20 interview with Diane Sawyer in April 2015, in which she revealed she identifies as female.
Losing its audience: The show debuted strong, but failed to hold onto viewers during its second season
perruques cheveuxCall me Caitlyn: The series was announced by E! immediately after Caitlyn's 20/20 interview with Diane Sawyer in April 2015, in which she revealed she identifies as female
Caitlyn starred in the show alongside other members of the transgender community, including Jennifer Finney Boylan, Candis Cayne, Chandi Moore, Zackary Drucker and Kate Bornstein, and famously clashed with her co-stars over her support of the Republican party.
Jenny shared on Facebook following the news: 'It's official as of today-- I AM CAIT will not be renewed for season 3. I am so very proud of being part of this show, and of its creators Andrea Metz and Jeff Olde in particular, who directed us with passion and grace.
'I am grateful for the warm friendships I made with Chandi Moore and Candis Cayne and @katebornstein and Zackary Drucker and @ellagieselle and all of you. (and Kip Zachary and Courtney Nanson, who made us look so fine!) There is more work to do, and I send everyone my love.'
'I am so very proud': Jennifer Finney Boylan shared a Facebook post thanking her cast-mates following the cancellation
'It was one of the best times of my life': Kate Bornstein also tweeted after hearing the news
She added: 'Official word from the network today- a hard choice for them, I know. I'll have more to say about this in weeks to come, but for now I'll simply say I'm proud of everything we accomplished, and I send everyone involved my very sincere gratitude, and my love.'
And Kate tweeted: 'Ah, #iamcait is done now. It was one of the best times of my life. Made such good forever friends. #allshowsclose.'
Caitlyn's ex-wife Kris Jenner, daughters Kendall and Kylie Jenner and former step-daughters Kim and Khloe Kardashian also made appearances on I Am Cait during its run.
Support network: The Olympian was joined on the show with fellow members of the transgender community, including (L-R) Chandi Moore, Candis Cayne, Ella Giselle and Jennifer Finney Boylan
Lady Gaga is to star in the remake of THE hit musical A Star Is Born alongside Bradley Cooper, who also makes his directorial debut with the weepie.
The movie is due to start production next year in California and Gaga will compose and perform new music for the soundtrack.
The 30-year-old's name was first mentioned in association with the project back in June but her casting was confirmed on Tuesday by Deadline Hollywood.
lace front wigsShe was born for it: Lady Gaga, seen at Tony Bennett's 90th birthday bash earlier is August, is to star in the remake of hit musical A Star Is Born alongside Bradley Cooper
The movie tells the story of a young singer-actress who finds fame and romance after she captures the heart of a fading movie star, to be played by Bradley, 41.
As his plummeting career and alcoholism take their toll, her star continues to rise.
The new film is the third remake of the original love story released 80 years ago in 1937.
Back then, Janet Gaynor played the ingenue and Fredric March was the falling star. Judy Garland and James Mason had a go at it in 1954.
Double hitter: The 41-year-old actor, pictured at the Los Angeles premiere of War Dogs on Monday, will also makes his directorial debut with the weepie
In 1976, Kris Kristofferson played a fading rock star with Barbra Streisand as a songstress on the rise.
It's the first starring role in a movie for Lady Gaga, whose real name is Stefani Germanotta.
However, the Born This Way songstress has been building her acting creds by co-starring as The Countess in FX's Golden Globe winning American Horror Story.
cosplay wigsUps and downs: The 30-year-old stars as a young singer-actress who finds fame and romance after she captures the heart of a fading actor, to be played by Bradley
Meanwhile, the movie has been a long time in the works.
Beyonce was earlier pegged for the role of the young star on the rise, but the casting fell through after the Crazy In Love singer became pregnant with her daughter Blue Ivy, now four years old.
'The world is in for a treat as these great artists craft an all new vision of A Star is Born,' Greg Silverman, Warner Bros. president of creative development and worldwide production, said in a statement.
Small screen to big screen: The Born This Way songstress has been building her acting creds by co-starring as The Countess in FX's Golden Globe winning American Horror Story