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McDonald’s Could Make $2B Up Front With Chinese Franchise Deal


McDonald’s hopes to make a deal to convert its 2,200-store Chinese empire into all-out franchising as the company looks to generate cash and growth.

The move would be a huge change for the firm’s China business—McDonald’s currently owns and operates 65% of its Chinese locations, yet people familiar with the matter say the Golden Arches could find a partner before the end of the year, the Wall Street Journal reports. When completed, the deal is expected to bring in between $1.5B and $2B up front from investors.

“The whole idea of franchising is that you have more flexibility and speed to market—and are more able to answer to consumer needs,” says McDonald’s China CEO Phyllis Cheung. And there is no shortage of takers for the deal—at least six bidders have shown interest, including Carlyle Group and Bain Capital. [WSJ]