Reuters has learned more than half a dozen companies have bid for McDonald's stores in China and Hong Kong. Fred Katayama reports that U.S. buyout firms are also participating.
McDonald's is selling not just burgers but its stores in China and Hong Kong, and Reuters has learned more than half a dozen companies have put in offers. Sources say the restaurant operator's auction could fetch up to $3 billion. Bidders include, they say, ChemChina, Beijing Tourism Group, and Sanpower. And buyout firms like Bain, Carlyle, and TPG are looking to team up with Chinese bidders. Like compatriot YUM Brands which runs KFC and Pizza Hut, McDonald's seeks local partners to better compete against its Chinese rivals and improve its corporate image in the aftermath of food-safety scares. Consumer food service analyst Elizabeth Friend of Euromonitor International said, "Given the difficulties Western chains have had recently with public perception, local players have become a serious competitive threat." A McDonald's spokeswoman would only say that the company was "making progress" in the sale process. Shares of McDonald's, which have soared under CEO Steve Easterbrook's reign, declined in early trading.