Yum Board Approves Spinoff Plan, Raises Dividend 11%
September 26 2016 - 11:40AM
Dow Jones News
Yum Brands Inc. said its board approved the planned spinoff of
its China unit, which remains on track to close at the end of next
month, as the company also raised its dividend by 11%.
The Louisville, Ky., company increased the quarterly dividend to
51 cents a share, an increase of a nickel a share.
Yum Brands said its board approved a distribution of one share
of Yum China common stock for each share of Yum Brands held as of
Oct. 19. The spinoff, set to close Oct. 31, is planned as a
tax-free distribution to shareholders.
Yum Brands said it has repurchased roughly $5.1 billion of its
shares and plans to buy back and additional $1.1 billion of its
stock before year's end. The moves are part of a previously
disclosed plan linked to the Yum China spinoff to return $6.2
billion of capital, excluding dividends, to shareholders.
Earlier this month, the owner of KFC and Pizza Hut, struck a
deal to sell a combined $460 million stake in the
soon-to-be-spunoff China operations to Primavera Capital and Ant
Financial Services Group, the financial affiliate of Chinese
internet giant Alibaba Group Holding Ltd.
The decision to separate the operations came after Yum Brands
fell under pressure from activist investors, including Corvex
Management LP and Dan Loeb's Third Point LLC.
Write to Tess Stynes at tess.stynes@wsj.com
(END) Dow Jones Newswires
September 26, 2016 11:25 ET (15:25 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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