Yum China: $17.6b private equity bid signals a bubble market

A huge offer for the fast-food chain operator is reminiscent of club deals in the 2006 to 2007 buyout boom — a salutary reminder on the 10th anniversary of the Global Financial Crisis.

Yum China: $17.6b private equity bid signals a bubble market

An attempt by private equity funds to take down NYSE-listed Yum China is a red flag for investors as it shows the bidders were prepared to pay a lofty valuation, banks were ready to fund the ambitious deal and too many cooks were lined up to run the flagging business.

The consortium comprising Hillhouse Capital, Kohlberg Kravis Roberts, China’s sovereign wealth fund China Investment Corp. CIC and Baring Private Equity Asia made the $17.63...

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