Tycoon Kith Meng’s Royal Group announced in a statement August 31 that they will form a joint venture with a Malaysian firm to bring the international fast-food giant KFC to Cambodia.
The introduction of KFC—originally known as Kentucky Fried Chicken—would mark the first entry of a major international fast food franchise in Cambodia.
According the statement, the Royal Group will be partnering with QSR Brands Bhd, which currently operates more than 460 KFC restaurants in Malaysia, Singapore and Brunei.
QSR recently received approval from Yum! Restaurants Asia Pte, Ltd—Yum owning the KFC brand, as well as other major chains like Pizza Hut and Taco Bell.
According to the statement, QSR will have a 55 percent stake in the joint venture, the Royal Group will hold a 35 percent stake and the remaining 10 will belong to start-up Malaysian firm Rightlink Corporation, Ltd. Debasish Pattnaik, director of business development for the Royal Group, said Rightlink helped broker the deal.
Pattnaik said that the plan is to first open four KFC restaurants in Phnom Penh, starting perhaps as soon as November, and then expand to Siem Reap and Sihanoukville. The statement quotes QSR Chairman Tan Sri Muhammad Ali bin Hashim as saying that the initial investment in the franchises will be about $3 million.
“Other outlets in the city will be rolled out in stages at the rate of around 2 new stores per year,” he is quoted as saying.
The KFC deal marks the latest in a series of Royal Group joint ventures with international firms that have pushed the conglomerate into a wide variety of industries. The firm entered into banking in 2004 by partnering with the Melbourne-based ANZ Bank and just recently made a foray into insurance with the Malaysian firm Infinity Financial Services.
Pol Ratana, marketing officer for local fast food chain Lucky Burger, said that his company is worried about competition from KFC, but believed that his restaurant had already built up a loyal following.
“To compete with the famous KFC restaurant, we should wait and see first before setting any strategy to gain support from our customers,” he said, adding that it was fortunate that Lucky Burger sells items other than fried chicken.