Devyani International, Sapphire Foods to merge as single Yum! India franchisee
They plan to expand KFC outlets, revive Pizza Hut, and grow DIL’s newer brands in India.
Devyani International Limited (DIL), which operates KFC and Pizza Hut outlets in India, has entered a merger agreement with Sapphire Foods (SFIL) through a share-swap arrangement.
Under the terms, DIL will issue 177 of its shares for every 100 shares of SFIL.
Arctic International, a Devyani group company, will acquire roughly 18.5% of SFIL’s shares from existing promoters, with the option to transfer them to a mutually agreed financial investor.
Upon completion, the transaction will result in DIL becoming one of the largest quick-service restaurant (QSR) operators in India, combining the two companies’ operations and aiming to drive growth, scale, and profitability.
The merged entity plans to focus on expanding KFC outlets, revitalising Pizza Hut, and growing DIL’s emerging brands portfolio.
Yum! Brands has approved the merger and agreed to commercial terms with DIL, including enhanced waivers for KFC and Pizza Hut to support expansion, the transfer of 19 KFC restaurants in Hyderabad from Yum! India to DIL, and a one-time payment covering merger approval and additional territory licensing.
“We are pleased to support this proposed merger to unlock a new phase of accelerated growth in the region and to advance supply chain operations, leading to a stronger, more resilient partner in India and greater value for both shareholder bases,” said Ranjith Roy, CFO of Yum! Brands.
DIL anticipates annual synergies of $23.3m-$25m (₹2.1b-₹2.25b) from the second year of combined operations.
Full integration of the two companies and realisation of these synergies is expected within 15–18 months of the merger’s effective date.
($1 = ₹90.08)
