Creador, NewQuest, TR invest Yum Brands India franchisee
Creador, NewQuest Capital Partners, and TR Capital have co-led an INR11.5 billion ($155 million) investment in Sapphire Foods India, a franchisee operator of US fast food giant Yum Brands.
Creador contributed $73 million to the deal, which it described as its first foray into India’s fast-growing quick service restaurant (QSR) industry. This included a combination of primary and secondary capital. Both NewQuest and TR are secondary specialists.
Sapphire Foods operates 437 KFC, Pizza Hut, and Taco Bell restaurants in India, Sri Lanka, and the Maldives. Existing investors include Samara Capital Group, Goldman Sachs Asset Management, CX Partners, and Edelweiss Private Equity.
Much of the strategy is based on observations that omni-channel QSR businesses in India have been relatively resilient to the impacts of COVID-19 and quick to rebound. Kabir Thakur, a managing Creador’s co-head of India, added that the pandemic has spurred a transformation in buying patterns, with consumers migrating from the independent outlets to internationally recognized brands.
“The QSR market in India has been growing at 19% during the last few years and eating out frequency is significantly lower at 1.5-2x per person per month versus 7-9x in other developed markets,” Thakur said in a statement.
“The QSR market in India is expected to grow at 20+% over the next four years. Sapphire Foods, with its combination of iconic brands that are well-loved by customers, strong focus on customer service, impressive track record, and a strong management team is well poised to capture a significant share of the Indian food services market.”
Last month, Creador reached a $500 million first close on its fifth South and Southeast Asia-focused fund. The target is $600 million, and a hard cap has been set at $680 million. This comes amid a difficult fundraising environment for Southeast Asian GPs.
Creador has sought geographic diversification by investing one-third of its capital in India since inception. It has made 40 investments to date, including Sapphire Foods. Consumer brands, food, and related services are core areas of focus, with recent activity in the QSR space including the acquisition of a 30% stake in Malaysian teashop and beverage chain operator Tealive.
More on South Asia
Latest News
Asian GPs slow implementation of ESG policies - survey
Asia-based private equity firms are assigning more dedicated resources to environment, social, and governance (ESG) programmes, but policy changes have slowed in the past 12 months, in part due to concerns raised internally and by LPs, according to a...
Singapore fintech start-up LXA gets $10m seed round
New Enterprise Associates (NEA) has led a USD 10m seed round for Singapore’s LXA, a financial technology start-up launched by a former Asia senior executive at The Blackstone Group.
India's InCred announces $60m round, claims unicorn status
Indian non-bank lender InCred Financial Services said it has received INR 5bn (USD 60m) at a valuation of at least USD 1bn from unnamed investors including “a global private equity fund.”
Insight leads $50m round for Australia's Roller
Insight Partners has led a USD 50m round for Australia’s Roller, a venue management software provider specializing in family fun parks.