Jack Ma's stake in KFC is less than 5%, so how can it be considered an acquisition? At most, it can be considered financing, with an investment of only US$460 million, which will be carried out simultaneously with the separation of Yum! Brands and Yum China.

What exactly did Jack Ma want to do by buying KFC?

In fact, the amount of investment is secondary. The most important thing is that Jack Ma made a move, which makes the nature of the matter very different.

The reason why Ant Financial and Primavera Capital, owned by Jack Ma, are willing to invest in KFC China at this time is nothing more than the following reasons:

First, the valuation is reasonable. We roughly calculated that the overall valuation of Yum China is about US$8 billion, so a total of US$460 million accounts for 6% of the shares, so it is quite reasonable that the exercise of rights will not exceed 10% at most.

Second, it enriches the offline usage scenarios of Alipay. After all, KFC's consumption scenarios are characterized by small amounts and high frequency, which are very suitable for the development of mobile payments. Alipay is the most important business of Ant Financial. Now that it is in competition with WeChat Pay, it is normal to spend some money, even if it is worth it to advertise.

Third, obtain more valuable big data information, whether it is a large number of upstream suppliers, farmers, or downstream consumers. Because Yum China has a huge industrial chain and has access to various production, supply and marketing data.

Fourth, the layout gives people endless imagination. As of 2015, including KFC, Pizza Hut, Little Sheep and East Dawning, Yum has a total of more than 7,100 stores in China. This scale is very large, and Yum's competitor McDonald's is only one-third of it. In other words, with KFC and Pizza Hut, which are fully deployed from first-tier to fifth-tier cities, anything can be done.