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Business Combinations, Asset Acquisitions, and Joint Venture Formation | 3 Months Ended
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Mar. 31, 2025
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract] |
Business Combination Disclosure [Text Block] | KFC United Kingdom ("U.K.") and Ireland Restaurant Acquisition On April 29, 2024, we completed the acquisition of all of the issued shares of two franchisee entities that owned 216 KFC restaurants in the U.K. and Ireland. The acquisition created a significant opportunity to accelerate KFC's growth strategy in the large and growing U.K. and Ireland chicken market. The purchase price to be allocated for accounting purposes of $177 million consisted of cash, net of cash acquired, in the amount of $180 million, which included $174 million paid in 2024 and $6 million paid in 2025, offset by the settlement of a liability of $3 million related to our preexisting contractual relationship with the franchisee. The acquisition was accounted for as a business combination using the acquisition method of accounting. The preliminary allocation of the purchase price is based on management's analysis, including preliminary work performed by third party valuation specialists, as of April 29, 2024. During the quarter ended March 31, 2025, we adjusted our preliminary estimate of the fair value of net assets acquired. The components of the preliminary purchase price allocation, subsequent to the adjustments to the allocation in the quarter ended March 31, 2025 and prior quarters were as follows:
Total Current Assets |  | $ | 2 |
Property, plant and equipment, net |  | 99 |
Reacquired franchise rights (included in Intangible assets, net) |  | 48 |
Operating lease right-of-use assets (included in Other assets) |  | 124 |
Total Identifiable Assets |  | 273 |
Total Current Liabilities |  | (30) |
Operating lease liabilities (included in Other liabilities and deferred credits) |  | (115) |
Other liabilities |  | (39) |
Total Liabilities Assumed |  | (184) |
Total identifiable net assets |  | 89 |
Goodwill |  | 88 |
Purchase price to be allocated |  | $ | 177 |
The cumulative adjustments to the preliminary estimate of identifiable net assets acquired (as recorded in the June 30, 2024 quarter of acquisition) resulted in a corresponding $12 million increase in estimated goodwill due to the following changes to the preliminary purchase price allocation.
|  | Increase (Decrease) in Goodwill
Increase in Property, plant and equipment, net |  | $ | (11) |
Increase in Required franchise rights |  | (1) |
Increase in Operating lease right-of-use assets |  | (15) |
Increase in Total Current Liabilities |  | 12 |
Increase in Operating lease liabilities |  | 13 |
Increase in Other liabilities |  | 8 |
Increase in consideration |  | 6 |
Total increase in Goodwill |  | $ | 12 |
We will continue to obtain information to assist in determining the fair value of net assets acquired during the remaining measurement period. Reacquired franchise rights, which were valued based on after-royalty cash flows expected to be earned by the acquired restaurants over the remaining term of their then-existing franchise agreements, have an estimated weighted average useful life of 5 years. The excess of the purchase price over the preliminary estimated fair value of the net, identifiable assets acquired was recorded as goodwill. The goodwill recognized represents expected benefits of the acquisition that do not qualify for recognition as intangible assets. This includes value arising from cash flows expected to be earned in years subsequent to the expiration of the terms of franchise agreements existing upon acquisition. The goodwill is expected to be partially deductible for income tax purposes and has been allocated to our KFC U.K. reporting unit. The financial results of the acquired restaurants have been included in our Condensed Consolidated Financial Statements since the date of the acquisition but did not significantly impact our results for the quarter ended March 31, 2025. Pro forma financial information of the combined entities for the periods prior to acquisition is not presented due to the immaterial impact of the acquisition on our Condensed Consolidated Financial Statements. The direct transaction costs associated with the acquisition were also not material and were expensed as incurred.

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 5 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479907/805-20-50-5 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 805 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/805/tableOfContent + Details
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