Everstone to sell a minority stake in the quick-service chain Burger King India

ASIA – Everstone Capital, India’s investment firm which operates the franchise Burger King plans to sell 20% of its stake in the quick service restaurant chain, reports ET Retail.

While Everstone holds about 88% of Burger King India, the parent Burger King Worldwide holds 12% stake in the restaurant.

According to two people familiar with the matter, the 20% values the chain at US$300-350 million and that the proposed transaction suggests that about 30-35% of Burger King India to be sold through secondary and primary offerings.

The sale process will be facilitated by the advisory firm EY and is expected to be launched in a few weeks.

Despite the transaction, Everstone which owns F&B Asia Ventures, a Pan-Asian food and beverage business platform that owns and operates Burger King’s branded restaurants in India and Indonesia will remain the controlling stakeholder in Burger King India.

Earnings

In the year 2017, Burger King India grew 68% to post sales of US$33.27 million, generating average sales of US$379,133.73 from each of its 88 outlets opened till March 2017.

Burger King notched up higher numbers than Jubilant FoodWorks where average sales per outlet were at US$294,881.79 from both brands, Domino’s Pizza and Dunkin’ Donuts.

Its rival Westlife Development, that runs McDonald’s in the south and west, posted average sales of US$505,511.64 from each outlet.

The Whopper burger maker entered India in November 2014 through a partnership with Everstone Capital when most quick-service restaurants were said to be struggling with falling sales.

It has lined up $100 million for expansion over the next few years and expects to open at least 40-45 restaurants in India in the next few years.

Leading quick-service restaurants have seen low same-store sales growth (SSG) since the past two years with consumers cutting back on discretionary spending.

Speaking on consumer trends, Harminder Sahni, managing director of retail consultancy firm, Wazir Advisors said: “Investor interest in Indian QSR is driven by the same trends that are driving consumption theme across categories such as demographics, urbanisation and eating out.”

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