UPDATE 2-Yum Brands in exclusive talks to sell Pizza Hut to LongRange Capital, source says

Yum! Brands, Inc.

Yum! Brands, Inc.

YUM

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Changes sourcing in headline and paragraphs 1,2; adds background throughout

By Abigail Summerville

May 29 (Reuters) - Yum Brands YUM.N is in exclusive talks to sell its Pizza Hut chain to LongRange Capital, a source familiar with the matter said on Friday.

The two parties are advancing in discussions about a potential deal that could come together in several weeks, the source said, adding that there is no guarantee a deal will be reached.

Yum Brands and LongRange did not immediately respond to Reuters' requests for comment.

Shares of Yum Brands, which also owns KFC, were up about 4% in extended trading following the news. Bloomberg News first reported the development earlier in the day.

This comes at a time when the fast-food industry is grappling with persistent demand weakness, as increasing use of GLP-1 weight-loss drugs prompts consumers to opt for healthier foods.

Rising inflation and a plunge in consumer sentiment to a record low in May have compounded the strain, making diners think twice before eating out. U.S. pizza giants are also struggling with stiff competition and rising commodity costs.


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