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New McDonald's China Sets Sights on Rapid Expansion

Although it has more outlets worldwide than Starbucks and KFC, McDonald's has been surpassed by the two in the world's most populous country, China. McDonald's China, formed on July 31, 2017, has around 2,700 restaurants in mainland China, including Hong Kong, while Starbucks has approximately 2,800 and KFC has about 7,200 locations.

The new owners of McDonald’s China are sealing deals with the country’s biggest property developers to secure the best store locations in a bid to catch up with the rival KFC franchise.

McDonald’s China Co., whose investors include state-backed Citic Ltd. and Citic Capital Partners, has signed a strategic alliance with China Evergrande Group to get the first look at locations in 250 cities, Zhang Yichen, chairman of the Chinese franchisee, said in an interview with Bloomberg News. The company is in the midst of negotiating similar agreements with China Vanke Co. and China Overseas Land & Investment Ltd., said Zhang.

“All of these developers are very close to Citic. It’s very easy for us to put them together,” Zhang, who is also chief executive officer of Citic Capital, said in Hong Kong Tuesday. “This is a strategy that you’re not going to find in the U.S., and it’s a strategic change that can only be made by people who understand how a market is shaped.” — Rachel Chang, Daniela Wei, Anna Luk, Shery Ahn & Betty Liu, Bloomberg News

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