Restaurants Development Company is exploring the sale of its KFC franchise business in Thailand, valued at roughly US$300 million, as revenue rebounds with a recovery in Southeast Asia’s second-largest economy.
The Bangkok-based firm, backed by a consortium led by Southeast Asian focused private equity firm AIGF Advisors Pte Ltd, is reportedly in talks with at least one advisor on the potential sale.
According to Reuters sources, Restaurants Development was considering the sale of its KFC business in 2020, but the process was shelved due to the impact of the coronavirus pandemic.
The revival of the sale comes with a pickup in Thai consumer confidence in June for the first time in six months, boosted by improved economic activity following an easing of pandemic curbs.
Restaurants Development said on its website that it recorded its highest ever quarterly sales and same-store sales growth rate in the first three months of 2022.
Its KFC business is expected to grow further over the next few quarters on the back of the economic recovery and easing of travel restrictions.
Two sources said potential suitors could include Central Restaurants Group and The QSR of Asia Co Ltd, a unit of Thai Beverage Plc, which run the other KFC franchises in Thailand.
Founded in 2016, Restaurants Development employs more than 5,000 people and operates more than 240 restaurants across Thailand. This compared with the 4,000 people and 200 restaurants it employed and managed two years ago.
According to its website, it currently owns 236 KFC stores.
As in other markets, Southeast Asian mergers and acquisitions activity is going through a soft patch, hit by high inflation, rising interest rates and weak equity markets.
Last week, Thailand’s central bank chief said the central bank will ensure the recovery is not interrupted by efforts to tackle higher inflation, amid expectations of an increase in interest rates. (NNT)
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