Yum Brands has reached an agreement to sell Pizza Hut in a transaction valued at $2.7 billion. The deal, announced Tuesday, involves the sale of Pizza Hut’s operations outside mainland China to private equity firm Longrange Capital for $1.5 billion, while Yum China will acquire the chain’s restaurants within mainland China for $1.2 billion.

Pizza Hut, a global pizza chain known for its pan pizzas and distinctive red-checkered tablecloths, operates approximately 15,500 locations across 108 countries, excluding mainland China. The brand generates around $10 billion in annual sales. The move comes as part of Yum Brands’ efforts to streamline its portfolio and focus on its stronger-performing chains, Taco Bell and KFC, which have maintained solid sales despite broader challenges facing the restaurant industry.

“These transactions enable Yum to be a more focused company,” said Chris Turner, CEO of Yum Brands. The company had been evaluating strategic options for Pizza Hut since late 2023 amid its comparatively weaker performance within Yum’s overall portfolio.

Founded in 1958 by two brothers in Wichita, Kansas, Pizza Hut began when the siblings borrowed $600 from their mother to open their first restaurant. The chain grew rapidly and became the largest pizza brand in the United States after it was sold to PepsiCo in 1977 for $300 million, equivalent to about $1.6 billion today. Under PepsiCo, Pizza Hut expanded significantly throughout the 1980s and 1990s, a period considered the peak of the brand's growth. In the late 1990s, PepsiCo spun off its restaurant division—including Pizza Hut, Taco Bell, and KFC—into a separate company that later became Yum Brands.

Yum Brands continues to hold strong positions with its other fast-food brands, but Pizza Hut has struggled to keep pace in a changing consumer landscape. The new ownership structure aims to provide fresh investment and strategic focus to revitalize the pizza chain across global markets.