McDonald’s is increasing its ownership stake in its China business from 20% to 48%. In 2017, the fast-food giant sold off control of its restaurants in mainland China, Hong Kong and Macau to Carlyle and Citic. Since then, McDonald’s has doubled its footprint in China to over 5,500 restaurants. The company aims to reach 10,000 restaurants by 2028.
The deal announced Monday will see McDonald’s buy out Carlyle’s stake in the business, giving it a larger minority share of 48% ownership. Financial terms of the deal were not disclosed, but it is expected to close in the first quarter of 2024 pending regulatory approval. Citic still retains its majority stake in the business with a 52% share.
McDonald’s CEO Chris Kempczinski stated that “We believe there is no better time to simplify our structure” given the potential for increased demand and growth in China’s rapidly expanding market. Despite struggling sales due to the Covid pandemic, which saw a decline of about 4% in revenue from mainland China compared to the previous year, McDonald’s remains committed to expanding its presence in China. The chain aims to continue drawing customers with promotions on burgers and other menu items.