Telepizza : The European Commission approves the strategic international growth alliance of Pizza Hut and Telepizza Group

The European Commission approves the strategic international growth alliance of Pizza Hut and Telepizza Group

• • The Directorate-General for Competition of the European Commission has authorised the agreement by which Telepizza Group becomes a leading multi-country pizza operator worldwide and the largest master franchisee of Pizza Hut by number of stores.

• • Following a 100% shareholder approval at the June General Shareholders' Meeting, the approval of the EU represents the last step in the closing of the Alliance.

• • The alliance will become effective on December 30, 2018. It will almost double the size of the Telepizza Group's portfolio to more than 2,500 stores and will give the Group access to over 500 million consumers across 37 countries.

• • In anticipation of the EU approval, since May, Telepizza Group has finetuned a detailed execution plan aimed at both reducing execution risk and creating shareholder value as of day 1 after the effective date.

MADRID, SPAIN, Tuesday, 4 December 2018 - The strategic alliance between Pizza Hut, a division of Yum! Brands, Inc., and Telepizza Group has received authorisation from the Directorate-General for Competition of the European Commission. The EU regulator thus approves an agreement that had previously been ratified by the Board of Directors of Telepizza Group and approved by 100% of the shareholders at the last General Shareholders' Meeting.

The definitive signature of the agreement will take place in the coming days becoming effective on December 30, 2018. With this deal, Telepizza Group will almost double the number of establishments to reach more than 2,500 stores. At closing, Telepizza Group system sales are projected to increase to 1.1 billion euro [$1.3 Bn], and by 2021, to an estimated EBITDA of 100 million euro. In addition, this growth will be accompanied by greater international presence, with operations across 37 countries, which represent more than 500 million potential consumers. The agreement also includes the opening of 1,300 Telepizza Group new stores over the next ten years in the regions covered by the agreement: Spain, Portugal, Latin America (excluding Brazil), the Caribbean and Switzerland.

"This strategic alliance with Pizza Hut gives Telepizza Group a competitive advantage in the QSR sector," says Pablo Juantegui, CEO and Chairman of Telepizza Group, who also adds that the company "always has been characterized by its pioneering attitude" and that therefore this is a "great step forward to keep leading the sector".

"Pizza Hut is focused on delivering the easiest, fastest and tastiest pizza experience wherever we operate," said Enrique Ramirez, Global Chief Growth Officer, Pizza Hut. "Telepizza Group is the ideal partner to help us deliver on this focus across Latin America (excluding Brazil), the Caribbean, Spain, Portugal and Switzerland, because of their incredible depth and capability in franchise delivery operations and supply chain management. Leveraging the strong experience of our Pizza Hut franchisees, we expect this alliance to accelerate the growth of Pizza Hut with a best-of-both approach."

Driving the preparation of the alliance since May

Telepizza Group has been anticipating the final closure of the strategic agreement with Pizza Hut since the May 16 announcement. Since then, within the limits of the anti trust laws, the company has launched the necessary initiatives to accelerate the implementation of the agreement, thereby minimising the execution risk and maximising value creation as of day 1 after the effective date.

In that context, Telepizza Group has acquired the Pizza Hut operation in Ecuador, a profitable business with a healthy track record. It is allowing Telepizza Group to operate the Pizza Hut model before the final closing, thereby confirming the estimations of value creation thanks to industrial synergies and business growth. The company has also filed a request for approval with the National Economic Prosecutor's Office in Chile regarding the potential acquisition of several Pizza Hut restaurants in the country.

Finally, over the last 6 months the Telepizza transformation office together with representatives of Pizza Hut have been working at full capacity to develop specific country-by-country plans that will allow the alliance to deliver on its value creation opportunities from the first day of the agreement application.

About Pizza Hut

For more information, visitwww.pizzahut.com.

About Telepizzawww.telepizza.comprensa@telepizza.com

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