Yum China (NYSE:YUMC) stock was down more than 13% on Tuesday as the firm that had an interest in buying out the brand reportedly lost interest in doing so.
The company’s shares reached a 17-month low as Hillhouse Capital is no longer seeking to buy Yum China, which operates fast food restaurants such as Pizza Hut, KFC and Taco Bell in China. Volume was up to a whopping 7.6 million early in the day, which is more than double of the full-day average.
The investor group that was interested in acquiring the company included KKR and it said that it was dropping out of the race of acquiring the brand as the initial proposal was turned down, according to people familiar with the matter who chose to remain anonymous.
Yum China was birthed after it was spun off from Yum Brands (NYSE:YUM) in October 2016 as it was losing market share due to changing tastes in the region, as well as growing competition from local restaurants and chains. The chain has been unable to reel in a younger audience to its Pizza Hut locations, despite major efforts such as a new menu, an overhaul of its mobile app and the addition of celebrities to promote its U.S. brand.
The company had a market cap of about $14.1 billion following Monday’s stock closing price.
YUMC stock was down more than 13% on Tuesday following the news.