Companies
Theobroma sale: Chrys Capital, Carlyle, Bain in final stage
Summary
Bakery chain Theobroma is likely to have a new private equity owner over the coming months as founder. The founder-owners, as well as ICICI Venture which holds a 42% stake in Theobroma, plan to sell their entire shareholding as part of the transaction.Mumbai: Private equity firms Bain Capital, Carlyle Group and Chrys Capital have submitted binding bids to acquire Theobroma Foods, two people aware of the development said, bringing the bakery chain's sale process to the final stage.
The bids were submitted last week, one of the two people said, adding the sellers were likely to pick the highest among them unless a fresh offer comes in at a higher price.
The 20-year-old patisserie chain, founded by former Oberoi Hotels pastry chef Kainaz Messman, had launched the sale process in January, after its private equity backer ICICI Venture decided to exit its investment. The company appointed investment bank Arpwood Partners to line up buyers.
“The real negotiations will begin now. The deal size is expected to be in the range of ₹2,500-3,000 crore," the second person cited above added.
Queries emailed to spokespersons for ICICI Venture, Bain Capital, Chrys Capital and Carlyle Group remained unanswered. When contacted over phone, founder Messman declined to comment.
Also Read | Cookies, cakes & stakes: Theobroma may change hands
The founder-owners, as well as ICICI Venture which holds a 42% stake in Theobroma, plan to sell their entire shareholding as part of the transaction. Mint had reported in January that the owners were expecting a valuation of around ₹2,800 crore for the company. ICICI Venture is the alternative investment arm of ICICI Bank.
Theobroma’s first pastry store opened in Mumbai’s Colaba Causeway in 2004, and was run by the founding family.
ICICI Venture bought a significant minority share in the food services company in 2017 for about $20 million. The funds were infused in two equal tranches, of which the first instalment was used to expand the brand to Delhi-NCR, and expand its presence in Mumbai and Pune. Since then, Theobroma has grown to become a pan-India chain of patisseries with 194 stores.
Also Read: Theobroma eyes 200 stores
Theobroma Foods reported a standalone net profit of ₹19.59 crore in FY23, against a net loss of ₹11 crore in FY22. Revenue from operations rose from ₹254.74 crore in FY22 to ₹351.67 crore in FY23, according to data platform Tofler.
If this transaction goes through, this would be the first consumer and food investment for Bain Capital.
Carlyle Group had invested in dairy products company Tirumala Foods back in 2010, while Chrys Capital is in advanced discussions to acquire Belgiam Waffle, Mint reported last month, signalling rising private equity interest in consumer food retail chains.
