Private equity firm Everstone Capital is in talks to sell its 41 per cent stake in Restaurant Brands Asia (RBA), which operates Burger King's franchise in India, to Jubilant Foodworks or a consortium led by Advent International, said banking sources on Thursday.
Jubilant operates Domino's Pizza franchise in India and if it buys a stake in BSE-listed RBA it will lead to a consolidation in the Indian restaurant industry, said the sources. Advent is likely to make an offer in association with another private equity firm, General Atlantic.
According to the share price on Thursday, Everstone's stake in RBA is valued at Rs 2,453 crore. RBA shares closed 13 per cent up at Rs 121 a share on Thursday. The company was listed in December 2020. An open offer for minority shareholders will follow as per market regulator Sebi’s takeover code.
Advent declined to comment. Jubilant Foodworks and Everstone did not reply to emailed queries.
Bankers said for Jubilant acquiring RBA would make sense as it is facing pressure on the margin front. Jubilant’s gross margin was down 160 basis points on a year-on-year basis mainly due to raw material cost pressure, said analysts.
Acquiring RBA would strengthen Jubilant, which operates 1,816 Domino's stores in 393 cities. Dunkin’ Donuts, another franchise, operates 21 stores in India.
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