Industry News | April 4, 2006

KFC and Rostik's Open First Co-Branded Restaurant in Moscow

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Yum! Brands, Inc., owner of the KFC brand, and Rostik Restaurants Limited, operator of Russia's top chicken restaurant chain, are opening today in Moscow the first of many co-branded KFC-Rostik's restaurants.

The remodeled Rostik's restaurant, located at Tverskaya-Yamskaya 2 (Mayakovsky Ploshchad), is 682 square-meters large and seats 364 guests. This opening follows the announcement in June last year of a unique strategic business alliance between the two companies to establish market leadership in the quick-service restaurant sector in Russia and the Commonwealth of Independent States (CIS).

At the opening ceremony, Graham Allan, President of Yum! Restaurants International, gave to RRL Chairman and CEO Rostislav Ordovsky-Tanayevsky Blanco a symbol representing Colonel Sanders' much-coveted blend of 11 herbs and spices. Allan said: "We're very excited to bring both KFC and Rostik's products under one roof to 140 million Russian consumers. Providing the best of both Brands to consumers in such a big way must be one of the most innovative and ambitious business alliances done in this part of the world."

Within the next 18 months, all existing KFC and Rostik's restaurants in Russia will be remodeled with a combined menu featuring Rostik's local favorites such as Shashlyk, Cheburek and Pelmeny and KFC's world famous chicken like Original Recipe® Chicken, Twister® Sandwich and Zinger® Sandwich. New logos, state-of-the-art exterior and interior designs, new uniforms and packaging will also be introduced. Over the next five years, RRL will make an investment of up to $100 million to support the development of some 300+ co-branded KFC-Rostik's restaurants in Russia and the CIS. At the conclusion of this five-year business alliance, Yum! Brands and RRL will have the option to transfer ownership of RRL's co-branded restaurants to Yum!. Alternatively, both parties may choose to maintain the current arrangement.

Today over 100 restaurants operate under the Rostik's brand in Russia and the CIS. Rostik's provides franchise support services to both KFC and Rostik's restaurants in Russia and the CIS. Under the parties' agreements, RRL will retain day-to-day operational management of its restaurants, while Yum! Brands will provide strategic support through its experience and technologies in managing international quick-service brands.