Yum! Sheds Two Brands

Sells Long John Silver's, A&W to key franchisees; chains no longer fit growth strategy

LOUISVILLE, Ky. -- Yum! Brands Inc. has announced that it has signed definitive agreements to sell Long John Silver's Inc. and A&W Restaurants Inc. to two separate buyers led by key franchisee leaders.

Long John Silver's will be acquired by LJS Partners LLC, led by a consortium of prominent franchisee leaders and other investors. A&W will be acquired by A Great American Brand LLC, led by a franchisee leader with substantial interests in international A&W restaurants and the National A&W Franchisees Association representing U.S. A&W restaurant operators.

Both sales are subject to customary closing conditions. Terms were not disclosed.

"We are pleased to announce that we have identified strategic buyers who are passionate about these two great restaurant brands and committed to their growth potential," said David C. Novak, Yum! Brands chairman and chief executive officer. "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."

The company does not expect the sales to have a material impact to its ongoing earnings or cash flow. Both transactions are expected to close in the fourth quarter. Goldman, Sachs & Co. acted as exclusive financial advisor to Yum! Brands on the transactions.

Long John Silver's Inc. is the world's most popular QSR seafood chain, specializing in batter-dipped fish, chicken, shrimp and hushpuppies since 1969. Today, there are more than 1,000 Long John Silver's restaurants worldwide and more than 700 additional points of distribution in multibrand restaurants.

A&W All American Food is the longest-running quick-service restaurant franchise chain in America. Since 1919, A&W  has offered its root beer, hamburgers and hot dogs. There are approximately 359 A&W outlets in the United States, more than 267 in 11 other countries and 623 additional points of distribution in multibrand restaurants.

Yum! Brands, based in Louisville, Ky., is the world's largest restaurant company in terms of system restaurants with approximately 38,000 restaurants in more than 110 countries and territories. Four of the company's restaurant brands--KFC, Pizza Hut, Long John Silver's and Taco Bell--are the global leaders of the chicken, quick-service seafood, pizza and Mexican-style food categories. Outside the United States, the Yum! Brands system opened approximately four new restaurants each day of the year, making it a leader in international retail development.