McDonald's sells controlling stake in China, Hong Kong business
The McDonald's logo is pictured in Beirut, Lebanon November 22, 2016. The Credit Libanais bank is seen in the background. Picture taken November 22, 2016. REUTERS/Aziz Taher

McDonald's Corp is selling 80 percent of its business in China and Hong Kong for US$2.1 billion as part of a restructuring aimed at increasing franchise footprint worldwide. China's state-backed investment firm Citic and Us private equity firm Carlyle Group agreed to buy the business.

Under the deal signed on Monday, which capped months of negotiations, Citic will hold a 52 percent share in the China business while Carlyle takes a 28 percent share. McDonald's will keep a 20 percent stake in China where it operates more than 60 percent of the nearly 2,400 outlets. McDonald's had about 240 outlets in Hong Kong at the end of 2016.

The agreement is for 20 years and is expected to close this summer, the Wall Street journal reported. McDonald's, which entered China in the early 1990s, said that with the change of ownership nearly 1,500 new restaurants will be set up in China and Hong Kong over the next five years.

An ownership structure change has been in the works at the global fast food giant for some time. The offloading of restaurants will help the company go light on operations while keeping a cut of the sales.

The company had said in March it was looking for partners in China and Hong Kong. McDonald's Chief Executive Steve Easterbrook told the WSJ the global giant is looking at replicating the franchise offloading route in South Korea as well.

"It's going to be a commercially successful outcome for us ... We won't be putting capital into the market, but we will be part of the decision-making process," Easterbrook said.