Why KFC and Taco Bell are locked into pouring Pepsi forever
When PepsiCo spun off its fast food chains in 1997, it attached a permanent string: the new company must serve Pepsi rather than Coca-Cola in its restaurants, with a few exceptions such as Israel and New Zealand. When Yum later absorbed A&W and Long John Silver's, both switched from Coke too, though A&W kept its famous root beer.
The soft drink giant stumbled into restaurants in 1977 by buying Pizza Hut from its founders, the brothers Dan and Frank Carney. It added Taco Bell a year later from Glen Bell, and in July 1986 picked up KFC from R. J. Reynolds, which needed cash to cover debt from buying Nabisco. Brief experiments with California Pizza Kitchen, Chevys and several other chains in the early 1990s were unwound when PepsiCo decided to leave the business.
The spin-off became effective on 6 October 1997 under the name Tricon Global Restaurants, after months under the placeholder Great American Restaurant Company. It settled in Louisville, KFC's home city, and traded under the ticker YUM, an exclamation of tasty enjoyment. In 2002 it merged with Yorkshire Global Restaurants, owner of A&W and Long John Silver's, and adopted the ticker as its corporate name.
Growth came mostly abroad. Yum opened its 40,000th restaurant in Calangute, Goa, in October 2013, and by 2016 ran 43,617 outlets in 135 countries and territories, all but 2,859 of them franchised. Chinese operations became a separate company, Yum China, in November 2016. Not every bet worked: a $222 million write-down followed its purchase of the hot pot chain Little Sheep, and a Chick-fil-A-style test called Super Chix was sold within about 16 months of opening.
The portfolio has since been reshaped again. Yum bought Habit Burger Grill for $375 million in 2020 and several restaurant technology firms after that. Pizza Hut, the chain that started it all, lagged behind Taco Bell in profitability, so in 2026 Yum sold it: the mainland China business to Yum China for $1.2 billion and the rest to LongRange Capital for $1.5 billion.
Source: Yum! Brands
