Yum! to buy 20% stake in Little Sheep

Yum! Brands, the US fast food giant, will pay US$63 million for a 20% stake in the Chinese hot pot restaurant chain Little Sheep Group, Dow Jones reported. Hong Kong-listed Little Sheep said Yum! will buy a 13.92% stake currently held by private equity firms 3i Group and Prax Capital Management at HK$2.40 (US$0.31) per share. The price represents an 8.4% discount to Little Sheep’s Tuesday closing price of HK$2.62. Yum! will buy an additional 6.07% stake from the Chinese firm’s controlling shareholders, also at HK$2.40 per share. Yum! operates the KFC, Pizza Hut and Taco Bell restaurant chains. Little Sheep, which raised US$100 million in a Hong Kong initial public offering last year, operates 375 restaurants mainly in China and Hong Kong.