Why Restaurant Brands is ceding Burger King China to a local partner

Restaurant Brands International (RBI), the parent company of Burger King, Tim Hortons and Popeyes, is making a fresh attempt to revive its fortunes in China. 

The company is handing over majority control of its struggling Burger King business in China to local private equity firm CPE for US$350 million, in an effort to strengthen its presence in the world’s second-largest market.

Through the joint venture, CPE will invest fresh capital to expand the chain’s footprint from 1250 outlets today to more than 4000 by 2035. The firm will own 83 per cent of the business, while RBI will retain a 17 per cent minority stake and seat on the board of directors. 

Besides physical expansion, the company will also use the fund to support marketing, menu innovation and operations.

“Our investment reflects our confidence in Burger King’s long-term potential in China,” Mark Mao, managing director of CPE, said. 

The transaction is expected to close in the first quarter of 2026.

A reset after a lost decade 

Burger King has had a long but underwhelming run in China. Its previous local operator, Turkey’s TFI Group, helped expand the chain from roughly 60 stores in 2012 to around 1500. But growth soon stalled. 

By contrast, Yum China’s KFC has built more than 12,000 outlets and turned China into its most profitable market. McDonald’s, backed by state-owned CITIC Capital, has nearly 8000. Domestic fried-chicken chain Wallace operates more than 19,000 stores. 

Earlier this year, RBI bought back TFI’s remaining stake in Burger King China for $158 million in cash. The previous franchise deal, which was due to expire in 2023, was terminated early. 

“For Burger King to catch up with KFC and McDonald’s, it needs a ‘navigator’ who better understands the Chinese market, similar to its situation with Starbucks China,” said Simon Sung, an independent F&B consultant. 

The structure mirrors other recent deals where Western consumer companies have ceded operational control. Last week, Starbucks announced a joint venture with Boyu Capital to strengthen its presence in China. 

McDonald’s took a similar approach in 2017 when it sold control of its China business to CITIC Capital and the Carlyle Group. 

In all cases, the logic is the same: local investors bring speed, local market understanding and political networks that global corporations often lack.

A market that’s still too big to ignore 

Despite China’s uneven recovery and a more cautious consumer environment, the structural case for growth in its restaurant industry remains strong. The country’s catering market reached RMB 5.29 trillion (US$727 billion) in 2023, a 20 per cent jump from 2022, outpacing overall retail sales growth. 

The quick-service segment alone is projected to grow from RMB 1.33 trillion this year to nearly RMB 2 trillion by 2029, according to industry forecasts.

That growth is coming increasingly from smaller cities, where Western QSR brands still have limited penetration but rising middle-class demand.

“China remains one of the most exciting long-term opportunities for Burger King globally,” Joshua Kobza, CEO of RBI, said. 

“CPE is a well-capitalised, proven operator with exceptional leadership and extensive consumer and restaurant experience, making them an ideal partner to fuel the next chapter of Burger King China’s growth.”

The target of 4000 outlets by 2035 will still leave Burger King well behind its major competitors. However, it signals a realistic and staged approach that balances capital deployment with operational improvement.

A cleaner structure and clearer focus 

The company has been steadily shifting away from ownership-heavy models toward what it calls a “simplified, highly franchised structure”, reducing capital intensity and focusing on brand stewardship rather than day-to-day operations.

The China partnership aligns perfectly with RBI’s broader international growth strategy, which aims for over 5 per cent annual net restaurant growth through 2028. With North American expansion slowing, that ambition increasingly relies on faster-growing overseas markets, particularly in Asia, where rising incomes and urbanisation continue to expand the consumer base for affordable dining.

Further reading: Starbucks’ China retreat shows how global brands must rethink their playbook.

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