Yum! looks to buy China-based ‘hot-pot’ chain

Three months after putting Long John Silver’s and A&W on the market, Yum! Brands on Tuesday announced that it’s trying to acquire Little Sheep Group Ltd. and its more than 300 restaurants, located primarily in China.

Yum! already owns 27.2 percent stake in the company, which is based in Baotou, Inner Mongolia, China. Tuesday’s offer is only preliminary, according to Yum!, and a formal offer would be made only after regulators approve the preliminary offer.

The quick-service giant’s presence is China is already strong, as it operates almost 4,000 restaurants there, including Taco Bell, Pizza Hut and KFC.

Listed on the Hong Kong Stock Exchange, Little Sheep is a “hot-pot” concept with a number of seafood items on the menu, ranging from shrimp to cuttlefish. The chain also has restaurants Japan, Canada and the United States.

In January, Yum! unveiled that it’s selling Long John Silver’s, America’s largest quick-service seafood chain, and A&W because they do not fit into the Louisville, Ky.-based company’s long-term growth strategy. The two brands represent less than 1 percent of Yum!’s total operating profit.

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