According to reports, firms including Carlyle Group LP (CG.US) and Yum China Holdings, Inc. (09987) are competing to acquire Jardine Restaurant Group from Jardine Matheson. The target company holds the KFC, Pizza Hut, and PHD franchise operations in Hong Kong, Taiwan, and other Asian markets, with a potential transaction value of approximately $400 million. Other potential bidders include Taiwanese food giant Uni-President Enterprises Corporation and other private equity firms. Non-binding offers for Jardine Restaurant Group are due this week.

Headquartered in Hong Kong, Jardine Restaurant Group operates roughly 1,000 KFC and Pizza Hut outlets across Hong Kong, Macau, Myanmar, Taiwan, and Vietnam, employing about 25,000 people. The company also owns the Hong Kong-based pizza delivery chain PHD. Sources indicate the overall business generates an EBITDA of around $35 to $40 million.

Global quick-service restaurant chains operating in Asia have benefited from urbanization, a young demographic, and growing demand for convenient, affordable meals. This has attracted significant investment from local strategic investors and private equity firms over the past decade. A report by ResearchandMarkets.com last year projected the Asia-Pacific fast-food market size to reach approximately $270 billion in 2024, growing to about $465 billion by 2033.

Both Carlyle Group LP and Yum China Holdings, Inc. possess extensive experience in the fast-food sector. Carlyle Group LP announced the acquisition of 100% of KFC Korea in December last year. In early 2017, it led a consortium to acquire a 20-year master franchise for McDonald's China for $2.08 billion, later selling its stake back to McDonald's (MCD.US) in 2023 for a substantial return. Yum China Holdings, Inc. was spun off from Yum! Brands in 2016 and operates brands like KFC and Pizza Hut in mainland China, with Primavera Capital Group and Ant Group among its major investors.

Sources added that Jardine Matheson is open to selling either individual market operations or the entire business as a package, depending on the terms of the offers. This divestment is part of Jardine's strategy to reallocate capital towards its core businesses.