Yum! to sell Long John Silver’s, A&W to franchisees

Yum! to sell Long John Silver’s, A&W to franchisees

Yum! Brands Inc. has signed definitive agreements to sell Long John Silver’s Inc. and A&W Restaurants Inc. to two separate groups of franchisees, the company said Thursday.

Terms of the deals were not disclosed.

The Louisville, Ky.-based Yum Brands, which also franchises KFC, Pizza Hut and Taco Bell, said Long John Silver’s would be sold to LJS Partners, a consortium of franchisees and other investors. A&W Restaurants will be sold to A Great American Brand, which Yum described as a “franchisee leader with substantial interest in A&W restaurants.”

Both sales are expected to be completed in the fourth quarter, Yum said.

“As we continue to sharpen our long-term growth focus on international expansion and improving our U.S. 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 Brands chairman and chief executive David Novak said in a statement.

Yum noted that the two sales would not have a material impact on corporate earnings or cash flow.

Goldman, Sachs & Co. acted as Yum’s exclusive financial advisor on the sales.

Yum! Brands, then called Tricon Global Restaurants, bought Long John Silver’s and A&W from Yorkshire Global restaurants for $320 million in cash in March of 2002.

In January of this year it announced plans to sell those brands [2] to focus on its larger concepts. It said at the time that the two brands together accounted for 1,630 units.

In announcing its second quarter results in July, which included a 28 percent decline in domestic operating profit, Yum! stressed the importance of international expansion as its growth vehicle [3], particularly with Pizza Hut and KFC, as it continues to work on turning around Taco Bell.

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Contact Bret Thorn at [email protected] [6].
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