FAS grants request of Smart Service for purchase of KFC's Russian business
MOSCOW. Nov 25 (Interfax) - Russia's Federal Antimonopoly Service (FAS) has granted a request by Smart Service (Izhevsk) for the acquisition of the Russian business of Yum Restaurants International Russia CIS (the KFC chain of fast food restaurants), the agency said in a statement.
As a result of the deal, the Russian company will own 70 restaurants and become a franchisor for 1,058 partner restaurants. 100% of stakes in the charter capital of Yum Restaurants International Russia CIS LLC will be purchased from Cyprus Caramel Restaurants Limited, a Cypriot company.
After the deal, both the chain's own restaurants and partner restaurants will continue to operate under the Rostic's brand, the rights to which are also being transferred under the deal.
"During the review of the request, the FAS assessed the impact of the transaction on competition within the regions where the companies are present and found no overlap in the activities of the participants. In addition, the food service market is generally assessed as highly competitive and there are no prerequisites for the emergence or strengthening of a dominant position," the statement said.
According to the agency, the deal will not affect the state of competition in food service goods markets. It will preserve jobs for employees and ensure the organization's further operations within the country.
As was reported in October, the American holding company Yum! Brands announced the signing of a purchase agreement for the transfer of rights for the company's Russian assets to local KFC franchise operator Smart Service, managed by Konstantin Kotov and Andrey Oskolkov. The assets include its own restaurants, the rights to a master franchise and a chain management system for franchised restaurants. Yum! Brands will cease its corporate presence in Russia following the closing of the deal.
In November, the Russian subsidiary of Yum! Restaurants changed its name to Unirest.
As Kotov has declared earlier, the deal for the purchase of KFC's Russian assets is due to be closed by the end of 2022, after which the rebranding process will begin. The new owner will have to rebrand all 1,000 KFC locations in Russia under the brand Rostic's which Yum Restaurants Russia LLC registered on September 1 of this year.