New York: Yum! Brands agreed to sell its Long John Silver's restaurants to LJS Partners and the A&W All-American Food chain to A Great American Brand for undisclosed prices as it focuses on expanding in China.
Definitive agreements have been reached to sell the chains, and the transactions are expected to be completed in the fourth quarter, the companies said in a statement.
Yum bought Long John Silver's and A&W for $320 million (Dh1.175 billion) in 2002, bringing the total to five brands it could offer under the same roof in two-in-one or three-in-one combinations. The company put the chains up for sale in January to focus on boosting sales in China and from its Taco Bell, Pizza Hut and KFC restaurants in the US.
Growth platforms
Long John Silver's and A&W are "not really international growth platforms, which is what Yum is pursuing," Sara Senatore, an analyst at Sanford C. Bernstein in New York, said in a telephone interview.
"They didn't really have even the domestic demand or growth that Yum was looking for when they bought them in the first place."
Yum, based in Louisville, Kentucky, has seen its shares gain 3.9 per cent this year.
Virginia Ferguson, a spokeswoman for Yum, declined to comment beyond the statement.
"As we continue to sharpen our long-term growth focus on international expansion and improving our US brand positions in KFC, Pizza Hut and Taco Bell, Long John Silver's and A&W no longer fit our long-term growth strategy," Yum CEO David Novak said in the statement.
