Everstone Capital Mulling Sale Of $314 Mn Worth Stake In Burger King's India Franchisee


Private equity firm Everstone Capital is reportedly considering selling its stake worth $314 Mn in NSE-listed Restaurant Brands Asia, the master franchisee of Burger King in India and Indonesia.

The Singapore-headquartered buyout firm is already in talks with one adviser to explore the potential sale, sources aware of the matter told Reuters. Everstone Capital, through its investment vehicle QSR Asia Pte Ltd, holds a 40.9% stake in Restaurant Brands Asia, the news agency said.

It is pertinent to note that the development of the potential sale comes when consumer spending has started rebounding in India and other Southeast Asian countries after the easing of coronavirus restrictions.

Restaurant Brands Asia, earlier known as Burger King India Ltd, was incorporated in 2013 as a result of a partnership between Everstone Capital and Burger King Worldwide to bolster the fast-food chain’s presence in India.

Everstone Capital is the private equity arm of Everstone Group and manages over $7 Bn of total assets. The firm focuses on the mid-market and invests in India and Southeast Asia-focused businesses.

On the other hand, with a total number of 315 operational restaurants in the country, Restaurant Brands Asia, in its annual report for financial year 2021-22 (FY22), claimed to be nearly half way through reaching its target of 700 restaurants by December 2026. 

The company reported a 91% jump in its revenue from operations to INR 943.7 Cr in FY22 with its company level EBITDA up 176% to INR 90.1 Cr. However, its net loss in the period stood at INR 92.9 Cr as against INR 173.9 Cr reported in FY21. With a market cap of INR 6,310.48 Cr, shares of Restaurant Brands Asia were trading marginally lower at INR 127.95 on the BSE on Friday. 

The quick service restaurant (QSR) market and the overall restaurant business in India was significantly hurt by the Covid-19 pandemic and the subsequent lockdowns. However, the growing online food delivery market played a massive role in helping the segment’s recovery. Besides, with the restrictions easing and physical stores opening, the market has started growing once again. The QSR market in the country is estimated to grow to over INR 500 Bn by 2025 from about INR 188 Bn in FY20.

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