Private equity is buying Pizza Hut, but it’s not getting the whole pie

Yum Brands approved the sale of its Pizza Hut restaurant chain for a total pre-tax amount of $2.7 billion this week. The iconic pizza chain, founded in Kansas in 1969, is being sold to two separate entities. LongRange Capital, a private equity firm headquartered in Connecticut, will acquire Pizza Hut's global operations, excluding those in China, for approximately $1.5 billion. This marks Pizza Hut as LongRange Capital's first restaurant chain acquisition; the firm's other holdings include 24 Hour Fitness and Bakkavor. The second buyer is Yum China Holdings, a separate entity spun off from Yum Brands in 2016, which will pay approximately $1.2 billion for Pizza Hut's operations within China. Yum Brands had been exploring strategic options for Pizza Hut, which has faced increased competition and lost its position as the world's most popular pizza chain to Domino's Pizza nearly a decade ago.