Citic Group has formally taken over the controlling interest in the Chinese stores of US fast-food chain McDonald’s.

Citic and Citic Capital jointly hold 52 per cent of a new company that will be the master franchisee for the brand on the Chinese mainland and in Hong Kong for the next 20 years. US private equity giant Carlyle Capital has a 28 per cent stake in the venture, while McDonald’s holds the 20 per cent balance.

Under an agreement reached in January, the venture paid US$2.08 billion for McDonald’s China business. It becomes McDonald’s largest franchisee outside the US, says Citic.

Earlier, the partners agreed to switch McDonald’s focus in the China market to smaller cities, with a plan to open more than 1500 restaurants on the mainland and in Hong Kong over the next five years.

Since McDonald’s opened its first China outlet in Shenzhen in 1990, China has become the burger chain’s third-largest market. More than a billion diners visited McDonald’s restaurants on the mainland last year.

In March last year, McDonald’s announced it was auctioning 20-year franchise rights on the Chinese mainland and in Hong Kong and South Korea as part of a worldwide strategy to remake itself into an asset-light, franchise-focussed model.

McDonald’s last month reported more than $6 billion in global revenue for the second quarter.