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McDonald’s agrees to buy back Carlyle stake in China

Nov 20, 2023
Illustration of fries and ketchup making a dollar sign

Illustration: Natalie Peeples/Axios

Carlyle has agreed to sell its minority stake in McDonald's China back to the parent company.

Why it matters: Under the investment company Citic and Carlyle, the region has become McDonald's second-largest market — and broadly, could be a boon for future PE deals in China.

  • McDonald's made an unsolicited buyout offer to Carlyle for the stake, a source familiar tells Axios' Dan Primack.

Of note: While Carlyle said it planned to move away from U.S. buyouts in the consumer, media and retail sectors, its Europe and Asia CMR teams wouldn't be affected.

Details: Citic Consortium will maintain its 52% stake in the business that operates and manages McDonald's business in mainland China, Hong Kong and Macau, while McDonald's will hold a 48% stake, increasing from 20%, once the deal closes.

What they're saying: The chain has doubled its restaurant count to more than 5,500 in the region since 2017, McDonald's says; systemwide sales growth has increased to over 30% year over year since September 2019, per McDonald's and Carlyle.

  • "The business has always delivered outstanding results and we wish them every success on their next phase of growth," X.D. Yang, Carlyle Asia's chairman, said in a statement.
  • Carlyle declined to comment further.

Meanwhile, the sponsor is reportedly running separate processes on Japanese cosmetics supplier Tokiwa Corp. and men's grooming brand Every Man Jack.

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