INDIA – Jubilant Foodworks Limited (JFL), which operates Domino’s Pizza and Dunkin Donuts in India, is poised to enter the European fast food chain business through an acquisition of Netherlands-based firm, Fides Food System.
According to report by Economic Times India, the acquisition of Fides Food System will be made through the company’s wholly owned subsidiary – Jubilant Foodworks Netherlands BV at a cost of US$34.78 millon.
Fides (currently owned by Turkish Private Equity Fund II LP) holds 32.81% equity shares in DP Eurasia NV, which is the exclusive master franchisee of Domino’s Pizza in Turkey, Russia, Azerbaijan and Georgia.
DP Eurasia (together with its subsidiaries) offers pizza delivery and takeaway/ eat-in facilities at 771 stores.
“We have been partners with Domino’s in India for more than twenty-five years; with that experience we hope to add value in DP Eurasia’s business and also create value for our shareholders,” JFL chairman Shyam Bhartia said in a statement.
JFL, India’s largest food services company, operates 1,314 Domino’s Pizza restaurants.
Its own businesses include chinese cuisine brand Hong’s Kitchen, biryani brand Ekdum and a ready-to-cook range of sauces, gravies and pastes under the label ChefBoss.
The message of the planned European entry was taken positively by the stock market, consequently resulting in the shares of the company surging more than 5 per cent in a weak market to hit a fresh 52-week high of ₹ 3,098.55.
In its recently released Q3 results, the operator of the Domino’s Pizza and Dunkin’ Donuts restaurants in India also reported a 22% rise in quarterly profit because of a surge in delivery and takeaway sales.
Net profit rose to ₹123.91 crore (about US$11.2 million) in the three months ended 31 December the from ₹101.80 crore (about US$9.2 million) recorded in the year earlier.
Domino’s witnessed complete sales recovery during the fiscal third quarter backed by continued momentum in delivery and takeaway channels, which grew by 18.5% and 64.3%, respectively, from the year-ago period, the company said.
Earlier, Jubilant FoodWorks announced plans to buy 10.76% stake in Barbeque Nation Hospitality Ltd (BNHL), which runs the popular Barbeque Nation (BBQ) chain of restaurants.
BNHL owns and operates 138 Barbeque Nation brand of casual dining restaurants that offer over-the-table barbeque live grills for diners in 73 cities across India, besides seven restaurants overseas.
The acquisition which will cost about US$12.53 million (₹92 crore ) will offer Jubilant FoodWorks – which has been expanding its presence in the dining-out market, across cuisines and formats- a larger play in India’s organized food services market.
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