CITIC Offloads McDonald’s Stake
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CITIC has plans to sell a 22 percent stake in McDonald’s Chinese mainland and Hong Kong business to its parent group’s private equity arm.
The main listed arm of the Chinese state-owned CITIC Group, CITIC Ltd., will aim to raise at least 2.17 billion yuan, according to a report citing a Beijing bourse filing.
The report also underlined CITIC Capital, the group’s alternative investment arm, as the likely buyer of the stake, adding to its $26 billion in assets already under management. Finalization of the deal is earmarked for early February, one of the sources added.
McDonald’s said that strategy and daily operations at its mainland and Hong Kong business would be unaffected by the deal. CITIC also provided assurances, noting that the deal was a purely «commercial decision» and that it would continue cooperation with McDonald’s business in China.
CITIC will be selling the 22 percent stake through Fast Food Holdings Ltd., a holding firm set up with CITIC Capital to hold the combined 52 percent stake of McDonald’s mainland and Hong Kong business. Following the deal, CITIC Ltd. will still hold 10 percent of the regional McDonald’s business.
Questions & Answers
Q.Which entity is the likely buyer of the 22 percent stake in McDonald's Chinese mainland and Hong Kong business?
Which entity is the likely buyer of the 22 percent stake in McDonald's Chinese mainland and Hong Kong business?
CITIC Capital, the alternative investment arm of the CITIC Group, is the likely buyer. This acquisition would add to its existing $26 billion in assets under management.
Q.What is the expected value that CITIC Ltd. Aims to raise from selling this stake?
What is the expected value that CITIC Ltd. Aims to raise from selling this stake?
CITIC Ltd., the main listed arm of the Chinese state-owned CITIC Group, aims to raise at least 2.17 billion yuan from the sale of the 22 percent stake.
Q.Will this deal impact the strategy or daily operations of McDonald's business in mainland China and Hong Kong?
Will this deal impact the strategy or daily operations of McDonald's business in mainland China and Hong Kong?
McDonald's stated that the strategy and daily operations of its mainland and Hong Kong business would remain unaffected by this deal. CITIC also assured continued cooperation.
Q.How much of the regional McDonald's business will CITIC Ltd. Still own after this transaction is completed?
How much of the regional McDonald's business will CITIC Ltd. Still own after this transaction is completed?
Following the finalisation of the deal, CITIC Ltd. Will retain a 10 percent stake in the regional McDonald's business. The 22 percent stake is being sold through Fast Food Holdings Ltd.