Yum! Brands is selling its struggling Pizza Hut chain in a deal worth $2.7bn (£2bn), the company has announced.
Private equity firm LongRange Capital will acquire the brand outside of mainland China for $1.5bn, while Yum China Holdings will buy the mainland China operations for $1.2bn.
"Under LongRange and Yum China, Pizza Hut will be well positioned for future growth with ownership that brings deep expertise in the restaurant industry," said Yum! Brands chief executive Chris Turner.
The decision comes after a prolonged period of difficulty for Pizza Hut - a name synonymous with casual dining in America.
Yum! Brands first revealed it was exploring a potential sale in November 2025, following several quarters of declining US same-stores. The American market is highly critical for the chain, as it makes up 40% of its total international sales.
The drop in performance has been driven by intensifying competition from revival chains like Domino's, Papa John's, and Little Caesars. At a time when inflation remains sticky, these rivals have aggressively discounted their offerings to win over price-sensitive consumers.
Moreover, mid-sized regional chains have also chipped away at the market. These smaller, more nimble fast-food competitors have adapted faster to changing consumer habits in the so-called "pizza wars".
At the same time, the rapid rise of third-party delivery apps has flooded the market with alternative options, diluting Pizza Hut's historic dominance.
Pizza Hut was founded in 1958, the brainchild of two brothers in Wichita, Kansas.
It was bought by PepsiCo in 1977 and then spun off into what became Yum! Brands in 1997.
"Pizza Hut is one of the most iconic restaurant brands in the world, and we are proud of the important role it has played in Yum!'s history," said Turner.
Yum! bought Pizza Hut's UK operations in October last year after DC London Pie, the firm running the dine-in restaurants, fell into administration.
While the financial collapse originally shut 68 restaurants and put more than 1,200 jobs at risk, about 64 restaurants were saved as part of a rescue deal.
By divesting the rest of the struggling division, Yum! Brands intends to streamline its corporate focus and resources on its remaining core brands, which include KFC and Taco Bell.
The transactions with LongRange Capital and Yum China are both expected to close in the third quarter of 2026, subject to customary regulatory approvals.
