Pizza Hut helped build Yum Brands into a fast-food giant. Now Yum looks ready to let it go.
Yum is in exclusive talks to sell Pizza Hut to LongRange Capital. That comes from a report citing a person close to the talks.
LongRange is a private equity firm. Such firms buy companies, try to fix them up, and aim to sell later for a profit.
A deal could land within a few weeks. But nothing is signed yet, and the talks could still fall apart.
The move is not a shock. Yum said last year it was weighing options for Pizza Hut, including a sale.
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Pizza Hut has been the weak spot in the lineup. Its U.S. sales have fallen for 10 quarters in a row.
That is more than two full years of customers slowly drifting away.
Pizza Hut once ruled the U.S. pizza scene. Newer chains and delivery apps chipped away at it for years.
The chain brought in about 12% of Yum's sales last year. Taco Bell and KFC carried the rest of the family.
Yum has spent years pushing Taco Bell and KFC hard, both at home and abroad. Pizza Hut never kept up with that growth.
The slump has already pushed Pizza Hut to close around 250 stores. That is a sign of how much it has been cutting to stop the bleeding.
This kind of weakness is exactly what draws buyout firms. They often pay less for a struggling brand and bet on a turnaround.
A private buyer can make hard changes away from the glare of public markets. Selling now would hand that cleanup job to someone else.
Yum is not the only one fielding interest. Earlier reports said Apollo Global Management and Sycamore Partners had looked at bids too.
Pizza Hut is also not the only pizza chain in play. Rival Papa John's has drawn its own takeover interest.
One firm, Irth Capital Management, has been working with Papa John's biggest U.S. franchisee. The plan would take that company private.
Both deals point to the same trend. Buyers are circling older restaurant brands while diners pull back and costs stay high.
Restaurants have had a rough stretch. Higher prices have pushed many people to eat at home more often.
Consolidation is the bigger story across the industry. Weaker chains are getting scooped up by private equity investors who think they can run them better.
Investors liked the Yum news. The shares rose about 3% after the report, though the stock is still down on the year.
For Yum, a sale would let it focus on its stronger brands.
A signed deal is the next thing to watch.
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