Skadden and Linklaters have been called in for KFC’s acquisition of more than 200 restaurants from EG Group, its largest franchisee in the UK and Ireland. 

Skadden is advising EG, the Blackburn-based business owned by the billionaire Issa brothers, on the deal having earlier this year acted for the group on the sale of the the majority of its UK business to Asda for £2.07bn. Meantime Linklaters is advising KFC. 

KFC parent company Yum Brands said on Wednesday that the deal would see all of EG’s KFC business in the UK and Ireland and 7,800 team members come under KFC management. 

The Skadden team acting for EG on the deal was led in London by the co-head of the firm’s UK corporate practice, George Knighton, and corporate associate Patrick Tsitsaros. It also included corporate associates Ali Alahmad and Sophie Lundsberg; tax partner Alex Jupp; employment of counsel Helena Derbyshire and European counsel Damian Babic; IP and data privacy counsel Eve-Christie Vermynck; and banking partner Clive Wells and associate Zoe Cooper Sutton.

Meantime the Linklaters deal team was led by global head of corporate Simon Branigan and global head of real estate Andy Bruce, with corporate counsel Christopher Quinn, managing associate Richard Ness and TMT associate Danny Greenland. 

The deal continues a longstanding relationship between Linklaters and Yum that also saw it advise the Kentucky-based company on the sale of subsidiary Pizza Hut’s 330 UK restaurants to restructuring investor Rutland Partners back in 2012. 

Yum, which also owns the Taco Bell franchise, among others, said the KFC deal represented “a significant opportunity to accelerate KFC’s growth strategy in the large and growing UK and Ireland market”. 

KFC UK and Ireland had grown system sales by 7% and same-store sales by 5% this year across its 1,040 restaurants, Yum said, adding that KFC had opened 200 new restaurants in the market since 2018 and had previously announced plans to open a further 500 by 2030.

Meantime EG said it would use the proceeds from the sale to pay down debt. 

“The transaction is an additional step in the company’s deleveraging strategy and continued progress towards putting in place a sustainable capital structure,” the group said in a statement.

EG Group continues to run franchise businesses with the Starbucks, Subway, Greggs, Sbarro, Chaiiwala and Cinnabon brands, as well operating its wholly-owned bakery business, Cooplands. 

The sale is expected to complete in the first half of 2024. The terms of the deal were not disclosed.