QSR, KFC buyout looms as JCorp chief quits boards

This is written by my colleague Adeline Paul Raj.


KUALA LUMPUR: Johor Corp Bhd president and chief executive officer Kamaruzzaman Abu Kassim has resigned from his post as chairman and director of both QSR Brands Bhd and KFC Holdings (M) Bhd, paving the way for the buyout of the two listed entities.

JCorp, which is Johor state government’s investment arm, owns 55.9 per cent of Kulim (Malaysia) Bhd.

Kulim, in turn, has a 53.9 per cent stake in QSR. KFC is a 51 per cent unit of QSR.

“With Kamaruzzaman’s resignation, they have moved closer towards the target sales and purchase agreement by May 21. 

"The privatisation of QSR and KFC, however, will be a long journey and will take many steps,” a source told Business Times in a phone interview yesterday.

In December 2011, JCorp and London-based CVC Capital Partners Asia III, via Massive Equity Sdn Bhd, announced their intention to buy QSR shares at RM6.80 each and RM3.79 per warrant. They also offered RM4 per KFC share and RM1 per warrant.

The source said with the latest developments, JCorp together with its partners are at arm’s length with each other to take the privatisation exercise further.

“The resignation is a gesture of good corporate governance on JCorp’s part as it is the majority shareholder,” said the source.

KFC Holdings (Malaysia) Bhd is involved in the fast food and other related businesses, which include poultry processing and distribution, commissary and bakery.

The US Kentucky-based Yum! Brands Inc is the licensor and owner of the KFC and Pizza Hut brand names.

The privatisation had run into some delays due to concerns by Yum!Brands that the exercise would stunt revenue and profit growth.

However, at a media briefing recently, Kamaruzzaman said Yum! Brands is happy with the privatisation plan. “They understand our proposal and are assured of further growth in the business. In fact, Yum! Brands sees this region as one of their most profitable,” he was quoted as saying.

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