Mitsubishi Corporation is exiting KFC Holdings Japan Ltd., the corporate entity overseeing the Kentucky Fried Chicken brand’s operations in the country, selling its entire ownership. More broadly, Mitsubishi is whittling down its asset portfolio to shore up its financial standing. The three-way share of KFC Holdings Japan is approximately 35% and Mitsubishi has initiated a bidding process. Foreign investment funds and leading names in the restaurant business are vying for its stake.
Assessing KFC Holdings Japan, whose market capitalization on the Tokyo Stock Exchange totals about 90 billion yen ($598 million), Mitsubishi is likely to score big. The stability in earnings and the potential that exists for a big expansion of urban area outlets in Japan will give a great deal of sex appeal to the Mitsubishi handling of KFC Holdings Japan in this sale.
The next pair of eyes watching very closely will be Yum Brands of the U.S. A crucial franchise agreement of KFC Holdings Japan is held with Yum Brands. How the negotiations go will no-doubt influence the much bigger restructuring Mitsubishi has underway now. The trading company has just agreed with telecommunications company KDDI to jointly manage the Lawson convenience store chain. To Mitsubishi, the business landscape of tomorrow is one being changed for profitability.
