US EditionIndia's KFC, Pizza Hut operators to merge in $934 million deal
The $934 million merger will create a fast-food franchisee with over 3,000 KFC and Pizza Hut outlets targeting cost synergies of up to 2.25 billion rupees annually.
- On Jan 1, Devyani International and Sapphire Foods announced an all-stock merger worth $934 million, with Devyani issuing 177 shares for every 100 Sapphire shares.
- Data from the quarter ended September show rising costs, with Sapphire’s costs at 7.68 billion rupees and Devyani’s at 14.08 billion, and both facing net losses.
- Jefferies analysts noted the deal's ratio closely matches January 1 market prices, with Devyani’s stock up 2.8% and Sapphire’s down 3%.
- Devyani said the combined group expects significant annual synergies of 2.1 billion to 2.25 billion rupees from the second full year, with JP Morgan analysts seeing strategic benefits.
- With more than 3,000 outlets, the combined entity will challenge Jubilant Foodworks and Westlife Foodworld as consumers trim discretionary spending.
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18 Articles
Indian Express
Business RecorderIndian KFC, Pizza Hut operator Devyani rises on $934 million Sapphire merger
India's KFC, Pizza Hut operator Devyani International jumped as much as 8.3% on Friday after announcing the long-anticipated $934 million merger with smaller peer Sapphire Foods, creating a fast-food major poised to challenge market leader
India’s KFC, Pizza Hut operators Sapphire Foods, Devyani International to merge in $934 Million deal
The deal comes as India's fast-food franchisees grapple with higher costs, slowing same-store sales and margin pressure, while facing stiff competition from McDonald's and Domino's Pizza operators in a market where consumers are cutting back on non-essential spending.
Times of India
The Economic TimesKFC operators Sapphire Foods-Devyani International's merger to create fast-food giant in India
Sapphire Foods India said it will merge with Devyani International, a move expected to consolidate local franchise partners of Yum Brands, which owns KFC and Pizza Hut. The companies said the proposed merger is subject to approvals from regulators, stock exchanges, the Competition Commission of India, the National Company Law Tribunal, and shareholders and creditors.
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