TPG Capital said to exit race for $2b McDonald's China rights

TPG Capital has exited the race for the McDonald's Corp China operations, leaving two other foreign buyout firms to compete with local bidders in a sale that could fetch as much as $2 billion, sources with knowledge of the process said.

Bain Capital has partnered with Chinese hotelier Green-Tree Hospitality for its offer, while Carlyle Group teamed with Beijing-based conglomerate CITIC Group Corp, the sources said. TPG's erstwhile partner, grocery operator Wumart Stores Inc, is said to be bidding on its own.

They are competing with dairy producer Beijing San-yuan Foods Co, which has also been negotiating terms of a potential deal with McDonald's, according to sources. McDonald's, which is selling 20-year mass franchise rights for the Chinese mainland and Hong Kong, plans to pick a winner by mid-November, they added.