LOUISVILLE, KENTUCKY — Yum Brands will sell Pizza Hut for $2.7 billion. The transaction will split the pizza business between private equity firm LongRange Capital and Yum China Holdings Inc. Both acquisitions are expected to close in the third quarter.

LongRange Capital will acquire Pizza Hut's operations outside of mainland China for approximately $1.5 billion, while Yum China Holdings Inc. will purchase the mainland China Pizza Hut business for approximately $1.2 billion. Yum initiated a strategic review of Pizza Hut in November after the chain reported declining comparable-store sales.

Yum also announced plans in February to close 250 Pizza Hut locations in the U.S. Yum's global sales increased by 5 percent last year, but Pizza Hut sales decreased by 2 percent during the same period. China represents Pizza Hut's second-largest market outside the U.S., accounting for 19 percent of sales.

"Pizza Hut has long been the weak link in Yum's portfolio," Neil Saunders, managing director of GlobalData, said. "Despite efforts to revitalize the brand and shut underperforming locations, it has become increasingly clear that pushing the division back into growth will require a level of investment and patience that Yum is just not prepared to commit to," Saunders said. "Under LongRange and Yum China, Pizza Hut will be well positioned for future growth with ownership that brings deep expertise in the restaurant industry," Chris Turner, chief executive officer of Yum, said.

Pizza Hut was founded in Wichita, Kansas, in 1958 by two brothers using $600 borrowed from their mother. The founders selected the name because their physical sign could only accommodate eight letters. The chain introduced its red roof design in 1969 and became the top global pizza chain by sales in 1971. PepsiCo acquired Pizza Hut in 1977 and later spun off its restaurant division in 1997 to form Yum, which also owns KFC and Taco Bell. Domino's emerged as the fastest-growing U.S. pizza company in the 1980s after implementing a 30-minute delivery guarantee. More recently, third-party services like DoorDash and Uber Eats expanded to offer consumers various food categories alongside pizza.