Yum is feeling out international expansion opportunities for Taco Bell, but there is little possibility that Taco Bell will supplant KFC and Pizza Hut as the key driver of economic growth. Those two firms have stronger product offerings for international markets. The role that Taco Bell plays, providing cash that can fuel global expansion of other brands, is the ideal role for the company within the context of Yum Brands. There are a couple of companies that could make a good fit for Yum. They are Starbucks and Dunkin Donuts. These firms operate in complementary segments to Yum's existing portfolio and have core product offerings that can be taken overseas, thus the industry is attractive. The stock price for the former is particularly depressed in light of their recent struggles although the latter is perhaps a better fit in terms of market positioning. The Starbucks stock price makes...

With Starbucks' Asian operations and ability to complement the existing Yum operations, Yum would be better off with such an acquisition.
Works Cited:

MacNealy, Jeremy. (2007). Fool on Call: Yum! Brands Wall of China. Motley Fool. Retrieved May 8, 2009 from http://www.fool.com/investing/general/2007/10/11/fool-on-call-yum-brands-wall-of-china.aspx

CNBC Video Report. (2008). CNBC Special Report on China Features Yum! Brands. CNBC. Retrieved May 8, 2009 from http://www.yum.com/news/pressreleases/081908.asp

Yum.com website: Multiple pages. (2009). Retrieved May 8, 2009 from www.yum.com

Taco Bell website: Multiple pages. (2009). Retrieved May 8, 2009 from http://www.tacobell.com/

Yum Brands 2008 Annual Report. Retrieved May 8, 2009 from http://www.yum.com/annualreport/docs/annualReport08.pdf