Yum! Brands' proposal for privatization of Little Sheep Group approved by Little Sheep shareholders; next step in process scheduled for Jan. 20

Nevin Barich

HONG KONG , January 6, 2012 (press release) – Yum! Brands, Inc. (NYSE: YUM - News) (“Yum!”) is delighted to announce that the proposal for the privatization of Little Sheep Group Ltd. (HKEx: 968; “Little Sheep”) by way of a scheme of arrangement (“Scheme”) has been approved by the independent shareholders of Little Sheep at the Court Meeting and Extraordinary General Meeting today. Under the proposal, Yum!, through a wholly owned subsidiary, is offering Little Sheep scheme shareholders HK $6.50 cash per Scheme share and is offering holders of options to subscribe for shares in Little Sheep HK $4.39 per option to cancel such options. Little Sheep operates hot pot concept restaurants primarily in China and is headquartered in Baotou, Inner Mongolia, China. Its shares are listed on the Hong Kong Stock Exchange.

Yum! will proceed to the next step of the privatization and will seek the sanction of the Scheme by the Grand Court of the Cayman Islands at the petition hearing on 20 January, 2012. Assuming the Scheme is approved by the Grand Court of the Cayman Islands, it is expected that the Scheme will become effective on 1 February, 2012, whereupon Little Sheep will be privatized and will become a subsidiary of Yum!.

Jing-Shyh Sam Su, Chairman and CEO of Yum! Restaurants China, Vice-Chairman of Yum! Brands, Inc. commented, “We are pleased to see that the Independent Little Sheep Shareholders value the offer provided by Yum!. We have a strong commitment to the China market and to the Little Sheep brand. We are confident we can further strengthen Little Sheep’s brand, business model and market position.”

Should the Scheme become effective, the two original Little Sheep founders, Mr. Zhang Gang and Mr. Chen Hongkai, will remain as minority shareholders. Mr. Zhang Gang will remain a director of Little Sheep with the title of “Founding Chairman.” Both Mr. Zhang and Mr. Chen will continue to provide strategic advice on the business and concept development of Little Sheep and work with Yum! to further build the Little Sheep brand.

About Yum! Brands and Yum! China

Yum! Brands is listed on the NYSE (YUM). It is the world's largest restaurant company based on number of system units, with over 36,000 units in more than 110 countries and territories. Through the three concepts of KFC, Pizza Hut and Taco Bell, Yum! develops, operates, franchises and licenses a worldwide system of restaurants which prepare, package and sell a menu of competitively priced food items.

Based in Shanghai, the China division of Yum! Brands, Inc. is recognized for its size, unique strength and importance. In 2010, the China division of Yum! Brands, Inc. opened more than 500 new restaurants in mainland China. KFC also continues to be the number one quick-service restaurant brand in mainland China today, with nearly 3,500 restaurants in more than 700 cities. Pizza Hut is also the number one casual dining brand in mainland China with over 560 Pizza Hut Casual Dining restaurants in over 130 cities.

About Little Sheep Group Ltd

Little Sheep is a company incorporated in the Cayman Islands with limited liability, whose shares have been listed on the Main Board of The Stock Exchange of Hong Kong Limited since June 12, 2008. The Little Sheep Group is principally engaged in the operation of a full-service restaurant chain, provision of catering services and sale of related food products.

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