October 27, 2016 / 9:42 AM / a year ago

Carlyle, Bain to battle for McDonald's China assets as TPG pulls out

A woman walks past a McDonald's outlet in Hong Kong in this July 25, 2014 file photo. REUTERS/Tyrone Siu/Files Photo

HONG KONG (Reuters) - Carlyle Group LP (CG.O) and Bain Capital LLC are the only major global buyout firms left bidding for McDonald’s Corp’s (MCD.N) restaurants in China and Hong Kong after TPG Capital Management LP [TPG.UL] pulled out, people close to the matter said on Thursday.

The two private equity firms, which have partnered with conglomerate CITIC Group Corp [CITIC.UL] and hotelier GreenTree Hospitality respectively, will compete with Chinese bidders for assets worth up to $3 billion, said the people, who declined to be identified because details of the deal are not public.

The people did not give a reason for TPG’s decision to pull out.

Chinese bidders include real estate firm Sanpower Group Co Ltd [SPGCL.UL] and mini-market operator Wumart Stores Inc, Reuters previously reported.

Carlyle, Bain and TPG declined to comment. McDonald’s did not respond to a Reuters request for comment outside regular U.S. business hours.

McDonald’s in March said it was reorganizing operations in Asia, bringing in partners as it switches to a less capital-intensive franchise model. It hired Morgan Stanley (MS.N) to run the sale of about 2,400 restaurants in China and Hong Kong.

Reporting by Elzio Barreto and Julie Zhu; Editing by Christopher Cushing

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