By Abigail Summerville
May 29 (Reuters) – Yum Brands is in exclusive talks to sell its Pizza Hut chain to LongRange Capital, a source familiar with the matter said on Friday.
The two parties are advancing in discussions about a potential deal that could come together in several weeks, the source said, adding that there is no guarantee a deal will be reached.
Yum Brands and LongRange did not immediately respond to Reuters’ requests for comment.
Shares of Yum Brands, which also owns KFC, were up about 4% in extended trading following the news. Bloomberg News first reported the development earlier in the day.
This comes at a time when the fast-food industry is grappling with persistent demand weakness, as increasing use of GLP-1 weight-loss drugs prompts consumers to opt for healthier foods.
Rising inflation and a plunge in consumer sentiment to a record low in May have compounded the strain, making diners think twice before eating out. U.S. pizza giants are also struggling with stiff competition and rising commodity costs.
(Reporting by Anuja Bharat Mistry in Bengaluru; Editing by Shilpi Majumdar)
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