Acquisition Strengthens Yum! Brands’ Global
Order Management and Delivery Capability and Integrates New
Technology Talent into Company
Yum! Brands, Inc. (NYSE: YUM) (Yum! Brands) announced today the
completion of its acquisition of Dragontail Systems Limited
(Dragontail), an innovative provider of technology solutions for
the food industry, following the successful implementation of the
previously announced share scheme of arrangement in accordance with
Australian corporations law.
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Yum! Brands acquired all of the issued and outstanding common
shares of Dragontail for A$0.235 per share in cash or a total of
approximately A$93.5 million. With today’s announcement, following
the approval by the Australian Federal Court and by Dragontail
shareholders and certain other regulatory waivers and rulings,
Dragontail is now a wholly owned subsidiary of Yum! Brands, Inc.
Yum! Brands estimates that this all-cash acquisition will have an
immaterial impact on its 2021 financial results.
Dragontail’s platform is focused on optimizing and managing the
entire food preparation process from order through delivery. Its
connected, intelligent, end-to-end AI-based solution automates the
kitchen flow combined with the process of dispatching drivers. It
helps restaurants sequence and time each order, while planning
optimal delivery routes and combining delivery orders by location.
The technology also offers consumer-facing capabilities that enable
customers to track their order en route. In addition, it can
operate with outside food delivery partners.
“A key growth driver for our business and our teams is the
continued acceleration of our digital and technology strategy,
including how we leverage our global scale with investments in
technology initiatives that enhance the customer and employee
experience, strengthen restaurant unit economics and provide a
competitive advantage for our franchisees,” said David Gibbs, Chief
Executive Officer, Yum! Brands. “We’re excited to welcome
Dragontail and its world-class talent to the Yum! family and look
forward to deploying its AI kitchen order management, delivery and
other technologies globally to our brands and franchisees over
time.”
Yum! Brands is focused on the continued acceleration of its
digital and technology initiatives across the globe, geared toward
providing customers with new and seamless ways to access its
brands, simplifying the lives of restaurant teams and improving
unit economics for franchisees. Delivery, which Yum! Brands offers
in over 39,000 restaurants, is a key part of the Company’s
strategy, driven by a combination of expanded aggregator
partnerships and continued investment in its own branded
channels.
“Dragontail’s cutting-edge restaurant technology allows us to
tap into the power of AI to optimize the end-to-end food
preparation process and accelerate and further enhance our delivery
technology capabilities,” said Chris Turner, Chief Financial
Officer, Yum! Brands. “We believe Dragontail will make it easier
for team members to operate and run a restaurant, help our
franchisees strengthen their store operations and provide a
superior experience for customers.”
Dragontail’s kitchen order management and delivery technology is
deployed across nearly 1,500 Pizza Hut restaurants in over 10
countries. Many Pizza Hut restaurants leveraging Dragontail’s
platform have already seen a positive impact on sales, order
fulfillment and customer satisfaction scores, including product
freshness and delivery time.
Yum! Brands’ purchase of Dragontail also brings in house other
Dragontail emerging technologies, including its QT AI camera
quality control system.
Dragontail's Managing Director Ido Levanon commented, “It is
exciting to see the completion of the acquisition of Dragontail by
Yum! Brands, who we have been collaborating with for years. This
transaction is a positive one for Dragontail shareholders and it
provides Yum! Brands with even more innovative technology. We look
forward to working together to deploy this technology to more Yum!
Brands restaurants around the world.”
The addition of Dragontail to the Yum! portfolio marks the
Company’s third technology acquisition in 2021. In March, Yum!
Brands acquired the business of Kvantum, Inc., an AI-based consumer
insights and marketing performance analytics company with a proven
track record of adding significant value in enabling data-driven
decisions to drive return on advertising dollars and increase
sales. That same month, Yum! Brands also acquired Tictuk
Technologies, a leading omnichannel ordering and marketing platform
company offering more ways for consumers globally to access and
order its brands through text, social media and other
conversational channels.
Transaction Details
With today’s announcement, Dragontail Systems Limited is now a
subsidiary of Yum! Brands, Inc., and will continue to be operated
as an independent brand.
The Dragontail business unit, as part of Yum! Brands, will
continue to offer technology solutions to its existing clients.
Dragontail employees will primarily be located in Israel, the
U.S. and Australia, and will continued to be managed by
Dragontail’s Managing Director Ido Levanon.
Baker McKenzie acted as lead legal advisor to Yum! Brands and
Thomson Geer acted as legal advisor to Dragontail Systems
Limited.
About Yum! Brands
Yum! Brands, Inc., based in Louisville, Kentucky, has over
51,000 restaurants in more than 150 countries and territories,
operating the Company’s brands – KFC, Pizza Hut and Taco Bell –
global leaders of the chicken, pizza and Mexican-style food
categories. The Company’s family of brands also includes The Habit
Burger Grill, a fast-casual restaurant concept specializing in
made-to-order chargrilled burgers, sandwiches and more. Yum! Brands
was included on the 2021 Bloomberg Gender-Equality Index. In 2020,
Yum! Brands was named to the Dow Jones Sustainability Index North
America and was ranked among the top 100 Best Corporate Citizens by
3BL Media.
About Dragontail
Dragontail is focused on revolutionizing the Quick Service
Restaurant (QSR) and foodservice industry with its two core
technology offerings, sold under a cloud-based, monthly
subscription, software-as-a-service model. Dragontail’s Algo
Platform is the first system in the world to fully automate and
streamline the kitchen flow to deliver an immediate and significant
return on investment to fast food and quick service restaurants,
integrating directly into a restaurant’s point of sale system. In
addition, its QT AI camera system’s sensor and camera system
automatically monitors the preparation and cooking process in the
kitchen, improving its efficiency and diagnostics using proprietary
patented, advanced AI machine-learning technology. Dragontail is
active in locations throughout Australia, New Zealand, the United
States, Latin America, Canada, Europe – UK, Belgium, Singapore,
South Africa and Israel. The Company is rolling out its technology
globally and has formed partnerships with global delivery services
across a growing number of countries.
Cautionary Statement Regarding Forward-Looking Statements
Certain statements in this communication contain
“forward-looking statements.” Forward-looking statements can be
identified by the fact that they do not relate strictly to
historical or current facts. Forward-looking statements are based
on current expectations, estimates, assumptions or projections
concerning future results or events, including, without limitation,
the projected closing of the transaction, the anticipated benefits
of the transaction, and the anticipated impact of the transaction
on Yum! Brands’ 2021 results. Forward-looking statements are
neither predictions nor guarantees of future events, circumstances
or performance and are inherently subject to known and unknown
risks, uncertainties and assumptions that could cause actual
results to differ materially from those indicated by those
statements. We cannot assure you that any of the expectations,
estimates or projections expressed herein will be achieved.
Numerous factors related to the transaction could cause actual
results and events to differ materially from those expressed or
implied by forward-looking statements, including, without
limitation: the effect of the announcement of the transaction on
Yum!’s and Dragontail’s business relationships, operating results
and business generally; the risk that the proposed transaction may
disrupt current plans and operations and the potential difficulties
in employee retention as a result of the transaction; the ability
to achieve the synergies and value creation contemplated; Yum!’s
ability to promptly and effectively integrate Dragontail’s
businesses; the risk that operating costs and business disruption
(including, without limitation, difficulties in maintaining
relationships with employees) may be greater than expected; the
assumption of unexpected risks and liabilities; the diversion of
and attention of management of both Yum! and Dragontail on
transaction-related issues; and the other factors discussed in
“Risk Factors” in Yum!’s Annual Report on Form 10-K for the fiscal
year ended December 31, 2020 and subsequent filings with the SEC
made by Yum!, which are available at http://www.sec.gov. Yum!
assumes no obligation to update the information in the
communication, except as otherwise required by law. Accordingly,
you should not place undue reliance on these forward-looking
statements.
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version on businesswire.com: https://www.businesswire.com/news/home/20210907005501/en/
Analysts are invited to contact: Jodi Dyer, Vice President,
Investor Relations and CFO, Digital & Technology at
888/298-6986 Members of the media are invited to contact: Virginia
Ferguson, Vice President, Public Relations, at 502/874-8200
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