In 2017, McDonald’s sold control of its restaurants in mainland China, Hong Kong, and Macau to private equity giant Carlyle and state-owned investment firm Citic. At that time, McDonald’s held onto 20% of the business. Since then, the fast-food giant has doubled its footprint in China to more than 5,500 restaurants, making it the second-largest market by number of locations. However, sales in China have struggled since the Covid pandemic began. The country accounts for about 4% of McDonald’s total revenue, down 3.8% from the year prior according to Factset estimates. On its latest earnings call, CEO Chris Kempczinski noted that China is dealing with “slowing macroeconomic conditions and historically low consumer sentiment.” Despite these challenges, McDonald’s is continuing to invest in its Chinese business. The company recently announced that it is buying Carlyle’s stake in its China business, increasing its minority share from 20% to 48% ownership. Financial terms of the deal were not disclosed but are expected to close in the first quarter of 2024 if regulators approve it. Citic still retains its 52% stake in the business.