(Yicai) Nov. 11 -- Chinese private equity firm CPE will invest USD350 million for an 83 percent stake in a new joint venture that will operate Burger King restaurants in China.

CPE and Burger King’s owner Restaurant Brands International will set up Burger King China to support the fast-food chain’s expansion, marketing, menu innovation, and operational capabilities in the country, the Beijing-based firm announced yesterday.

Multinationals in China are increasingly using joint ventures or selling majority stakes in local units to well-capitalized Chinese partners to speed up their expansion, reduce capital intensity, and leverage local know-how. 

A recent, high-profile example is Starbucks Coffee’s agreement with Boyu Capital. The US coffee chain announced on Nov. 4 that it will set up a China joint venture with the PE firm. Boyu Capital will own a 60 percent stake in the JV for about USD4 billion.

Once established in the first quarter of next year, Burger King China will sign a 20-year licensing agreement with an affiliate to obtain the exclusive rights to develop the Burger King brand in China. The deal requires regulatory approval.

Under the roadmap agreed by the two partners, Burger King’s China estate -- now roughly 1,250 eateries -- will expand to more than 4,000 outlets by 2035.

CPE manages 111 funds, with assets in excess of CNY180 billion (USD25.3 billion). It has invested around CNY10 billion (USD1.4 billion) in the consumer businesses such as ice cream and bubble tea store operator Mixue Group, ophthalmology hospital chain Aier Eye Hospital Group, jewelry brand Laopu Gold, and toymaker Pop Mart International Group.

Editor: Futura Costaglione