Yum Brands is in exclusive talks to sell its Pizza Hut chain to private-equity firm 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 there is no guarantee a deal will be reached.
LongRange declined to comment on Reuters' request, while Yum Brands did not immediately respond.
The move comes when the fast-food industry is contending with sustained demand weakness, as growing adoption of GLP-1 weight-loss drugs encourages consumers to choose healthier foods.
The pressure has been compounded by rising inflation and a decline in consumer sentiment, which has forced diners to think twice before eating out and weighed on U.S. pizza giants already facing elevated commodity costs.
Last year, Yum said it was reviewing "strategic options," including a possible sale, for Pizza Hut as the unit struggles to keep pace with its other fast-casual dining brands, including Taco Bell.
U.S. comparable sales at Pizza Hut, which contributed 12% to Yum's total revenue in 2025, have declined for 10 straight quarters.
Reuters reported in April that along with LongRange, Sycamore Partners and Apollo Global Management, among others, were vying for the chain.
Shares of Yum Brands, which also owns KFC, were up about 3% in extended trading. Bloomberg News first reported the development earlier in the day.
The U.S. restaurant industry is witnessing a dealmaking trend wherein several small chains have left the public market, including Denny's, Potbelly, California Pizza Kitchen, amid mounting input costs and deteriorating dining-out demand.
Papa John's International has also been looking to sell its business. Investment firm Irth Capital Management was working with the pizza chain's largest U.S. franchisee to take it private, Reuters reported this month.
