First of all, operating in Turkey for thirty-six years KFC ve Pizza Hut As İş Gıda A.Ş., which has been operating the brands since 2020, we would like to share our deep sorrow with all our stakeholders and the public regarding the developments that occurred as a result of the unilateral termination of our contract with Yum! Brands.

We are aware of the responsibility we carry for our employees, business partners and customers in this process. We are working hard to ensure that the process progresses in the healthiest way possible and with the least possible harm for all our stakeholders. We are determined to manage this process with transparency.

Our Current Situation

In our journey, which we started with 2020 KFC restaurants in 138 and continued with 2022 Pizza Hut restaurants in 58, we reached 35 restaurants, all owned by İŞ Gıda, in 537 cities with new restaurant openings in less than four years. In this process, we not only increased the number of our restaurants; we built a widespread ecosystem from supply chain to construction and courier operations and created employment for thousands of people.

We have consistently covered the investment costs of this rapid growth with our own resources. We have invested every penny we earned into opening new KFC and Pizza Hut restaurants as directed by Yum! Brands. As a result, we began to face financial difficulties in the last quarter of 2024 and had to apply for very high-interest loans.

In the meantime, we started negotiations with Yum! Brands to prevent any harm to both our brands and stakeholders. In these negotiations, transferring all operations to them was also among the options. While the process was progressing positively, they suddenly decided to unilaterally terminate our contract on January 8, 2025, ending our four-year partnership. As a result, we had to stop the operations of all our KFC and Pizza Hut restaurants across Turkey.

This development has had important consequences for our employees, business partners and customers. We are taking the necessary steps to minimize the effects of the process and to protect the rights of all our stakeholders, especially our employees.

We have applied for a composition by evaluating the financial and operational conditions of our company in order to fulfill our obligations in a sustainable manner and to secure the rights of all our stakeholders. The court has decided to grant a three-month temporary extension as of January 31, 2025 before the composition becomes final.

This process is a precaution taken to restore the financial balance of our company and to develop the most appropriate legal solutions for all parties. The management of the composition process is carried out within the relevant legal framework, under the supervision of court-appointed composition commissioners, and under the supervision and guidance of the competent authorities.

Our Roadmap for Our Employees

We are aware of how our employees and their families have been affected by this process and we deeply feel the sadness. Our priority is to protect the vested rights of our employees and to ensure that the process is completed with the least amount of victimization for them. In this regard, we are carefully managing the process by taking the necessary steps.

• In order to secure the rights of our employees, we carry out processes related to salary and personnel rights in coordination with authorized institutions.
• As a result of regular salary payments made to date, our employees do not have any salary receivables prior to 2025. However, due to the difficulties experienced after Yum! Brands unilaterally terminated our contract on January 8, for the first time in our company history, January salaries could not be paid on the usual payment date.
• Legally, employees working during the composition process can receive their unpaid salaries through İŞKUR during the final term of the composition. However, in case this process takes a long time, our company prioritizes the January salaries that were due on February 5 and could not be paid, in order to prevent our employees from being victimized, and plans to pay them by the end of February with the income to be obtained following the transfer of the restaurants in February.
• Due to the cessation of our operations due to the termination of our contract by Yum! Brands, termination procedures will be initiated within the scope of Article 18 of the Labor Law, in accordance with the principle that termination is mandatory and a last resort.
• Within the scope of termination procedures, severance pay, notice pay and leave receivables of our employees, if any, are legally reserved.

Our Roadmap for Our Business Partners and Suppliers

• We are taking the necessary steps to ensure that our business partners and suppliers are minimally affected by this process.
• We manage the composition process meticulously in order to fulfill our obligations.

Information to Our Customers and the Public

Serving their customers in Turkey for thirty-six years, the KFC and Pizza Hut brands have been met with great interest in our country and have reached a wide customer base. As İş Gıda, we have also contributed to the spread of these brands throughout Turkey by increasing the number of restaurants in the last four years of this journey.

All of our KFC and Pizza Hut restaurants were regularly inspected by Yum! Brands-approved independent auditing organizations for compliance with global operational standards, and because our operation met these quality standards, it was able to continue its operations without interruption until the termination decision. The trust and satisfaction of our customers has always been our top priority.

However, we regret to inform you that due to the unilateral termination of our partnership with Yum! Brands, we have had to close all of our restaurants and stop serving our customers.

We are aware of how our customers have been affected by this process and we deeply feel their sadness. We will continue to provide transparent and regular public information in order to eliminate the uncertainties.

Those who have questions or would like to express their opinions throughout the process can contact us via bilgi@isgida.com.tr. You can also find answers to frequently asked questions and the latest developments about the process in the information pool we have created on our website.

We would like to thank all our stakeholders and the public for their understanding throughout this process.

Source: Is Food Inc.