ChrysCapital is planning to establish an investment platform as it nears deals for at least two dessert chains, Theobroma Foods and Belgian Waffle Co., with a combined valuation of approximately INR 3,200-3,500 crore, according to ET, citing sources familiar with the matter. The͏͏ firm͏͏ has͏͏ a͏͏ 60-day͏͏ period͏͏ to͏͏ submit͏͏ a͏͏ binding͏͏ offer͏͏ for͏͏ Theobroma͏͏ and͏͏ aims͏͏ to͏͏ finalise͏͏ the͏͏ acquisition͏͏ terms͏͏ for͏͏ Bloombay͏͏ Enterprises,͏͏ which͏͏ operates͏͏ Belgian͏͏ Waffle,͏͏ for͏͏ around͏͏ INR͏͏ 1,000͏͏ crore͏͏ within͏͏ the͏͏ next͏͏ 30͏͏ days.
Continue͏͏ Exploring:͏͏ QSR͏͏ chain͏͏ The Belgian Waffle set͏͏ for͏͏ major͏͏ PE͏͏ buyout͏͏ as͏͏ negotiations͏͏ enter͏͏ final͏͏ stage
Major͏͏ Stakeholders͏͏ and͏͏ Investments:
Bloombay͏͏ is͏͏ co-owned͏͏ by͏͏ founders͏͏ Shrey͏͏ and͏͏ Alisha͏͏ Aggarwal,͏͏ along͏͏ with͏͏ investor͏͏ Marathon͏͏ Edge͏͏ Partners,͏͏ which͏͏ holds͏͏ a͏͏ 22%͏͏ stake.
ChrysCapital͏͏ is͏͏ aiming͏͏ to͏͏ raise͏͏ $2-2.2͏͏ billion͏͏ for͏͏ its͏͏ tenth͏͏ fund,͏͏ the͏͏ largest͏͏ to͏͏ date,͏͏ as͏͏ it͏͏ competes͏͏ with͏͏ EQT͏͏ Partners͏͏ for͏͏ the͏͏ Theobroma͏͏ buyout͏͏ and͏͏ enters͏͏ the͏͏ final͏͏ stages͏͏ of͏͏ due͏͏ diligence.͏͏ The͏͏ firm͏͏ has͏͏ successfully͏͏ returned͏͏ over͏͏ $7͏͏ billion͏͏ from͏͏ 80͏͏ exits͏͏ and͏͏ has͏͏ invested͏͏ $4.5͏͏ billion͏͏ across͏͏ more͏͏ than͏͏ 100͏͏ ventures.
Nikhil͏͏ Raghavan,͏͏ a͏͏ former͏͏ Bain͏͏ executive,͏͏ leads͏͏ Marathon͏͏ Edge͏͏ Partners,͏͏ a͏͏ fund͏͏ focused͏͏ on͏͏ technology͏͏ and͏͏ consumer͏͏ investments͏͏ in͏͏ the͏͏ small͏͏ and͏͏ mid-market͏͏ segment.
Theobroma’s͏͏ Ownership͏͏ and͏͏ Sale͏͏ Process:
Theobroma’s͏͏ largest͏͏ shareholder,͏͏ private͏͏ equity͏͏ fund͏͏ ICICI͏͏ Venture,͏͏ tasked͏͏ Arpwood͏͏ with͏͏ finding͏͏ a͏͏ buyer͏͏ in͏͏ January.͏͏ ICICI͏͏ Venture͏͏ holds͏͏ a͏͏ 42%͏͏ stake͏͏ in͏͏ the͏͏ 20-year-old͏͏ patisserie͏͏ chain,͏͏ while͏͏ the͏͏ founding͏͏ Messman͏͏ family͏͏ owns͏͏ a͏͏ 51%͏͏ bloc,͏͏ equally͏͏ divided͏͏ among͏͏ its͏͏ four͏͏ members.͏͏ Employees͏͏ and͏͏ senior͏͏ management͏͏ hold͏͏ the͏͏ remaining͏͏ 6-7%.͏͏ All͏͏ stakeholders͏͏ are͏͏ anticipated͏͏ to͏͏ exit,͏͏ contingent͏͏ on͏͏ the͏͏ final͏͏ valuation.
Both͏͏ chains͏͏ began͏͏ in͏͏ Mumbai͏͏ and͏͏ have͏͏ since͏͏ expanded͏͏ throughout͏͏ India͏͏ with͏͏ the͏͏ help͏͏ of͏͏ financial͏͏ investors.͏͏ Theobroma͏͏ was͏͏ founded͏͏ in͏͏ 2004͏͏ as͏͏ a͏͏ single-store͏͏ bakehouse͏͏ on͏͏ Colaba͏͏ Causeway͏͏ by͏͏ sisters͏͏ Kainaz͏͏ Messman͏͏ Harchandrai͏͏ and͏͏ Tina͏͏ Messman͏͏ Wykes,͏͏ who͏͏ borrowed͏͏ INR͏͏ 1͏͏ crore͏͏ from͏͏ their͏͏ father͏͏ as͏͏ seed͏͏ capital.͏͏ It͏͏ remained͏͏ a͏͏ family-run͏͏ enterprise͏͏ until͏͏ ICICI͏͏ Venture͏͏ made͏͏ a͏͏ $20͏͏ million͏͏ commitment͏͏ in͏͏ 2017.͏͏ In͏͏ 2015,͏͏ the͏͏ company͏͏ appointed͏͏ an͏͏ external͏͏ CEO,͏͏ Cyrus͏͏ Shroff,͏͏ a͏͏ former͏͏ senior͏͏ executive͏͏ at͏͏ KKR͏͏ &͏͏ Co.
Theobroma͏͏ now͏͏ operates͏͏ around͏͏ 220͏͏ stores͏͏ and͏͏ delivery-only͏͏ outlets͏͏ in͏͏ 27͏͏ cities,͏͏ including͏͏ the͏͏ six͏͏ largest͏͏ metros.͏͏ Its͏͏ adjusted͏͏ EBITDA͏͏ for͏͏ FY24͏͏ was͏͏ INR͏͏ 60͏͏ crore͏͏ on͏͏ a͏͏ topline͏͏ of͏͏ INR͏͏ 380-400͏͏ crore,͏͏ and͏͏ it͏͏ aims͏͏ to͏͏ achieve͏͏ an͏͏ EBITDA͏͏ of͏͏ INR͏͏ 80-85͏͏ crore͏͏ in͏͏ the͏͏ current͏͏ financial͏͏ year.
The͏͏ sale͏͏ of͏͏ Theobroma͏͏ has͏͏ attracted͏͏ interest͏͏ from͏͏ leading͏͏ private͏͏ equity͏͏ funds,͏͏ including͏͏ Bain͏͏ Capital,͏͏ Carlyle,͏͏ Warburg͏͏ Pincus,͏͏ Advent,͏͏ and͏͏ Kedaara͏͏ Partners,͏͏ as͏͏ well͏͏ as͏͏ the͏͏ Switz͏͏ Group,͏͏ led͏͏ by͏͏ the͏͏ Khorakiwala͏͏ family,͏͏ known͏͏ for͏͏ their͏͏ other͏͏ ventures͏͏ such͏͏ as͏͏ Wockhardt͏͏ Pharma,͏͏ Monginis,͏͏ and͏͏ Akbarallys.͏͏ Currently,͏͏ ChrysCapital͏͏ and͏͏ EQT͏͏ are͏͏ the͏͏ last͏͏ two͏͏ contenders.͏͏ While͏͏ they͏͏ are͏͏ competing͏͏ separately͏͏ for͏͏ the͏͏ acquisition,͏͏ they͏͏ have͏͏ previously͏͏ collaborated͏͏ on͏͏ multiple͏͏ transactions,͏͏ including͏͏ the͏͏ acquisition͏͏ of͏͏ Credila͏͏ from͏͏ HDFC͏͏ Bank͏͏ and͏͏ GeBBs.͏͏ Sources͏͏ indicate͏͏ that͏͏ they͏͏ may͏͏ join͏͏ forces͏͏ again͏͏ to͏͏ co-create͏͏ the͏͏ planned͏͏ investment͏͏ platform.
Belgian͏͏ Waffle͏͏ has͏͏ established͏͏ over͏͏ 560͏͏ smaller-format͏͏ stores͏͏ and͏͏ kiosks͏͏ across͏͏ 190͏͏ Indian͏͏ cities͏͏ in͏͏ its͏͏ nine͏͏ years͏͏ of͏͏ operation.͏͏ According͏͏ to͏͏ filings͏͏ obtained͏͏ from͏͏ the͏͏ intelligence͏͏ platform͏͏ Tofler,͏͏ the͏͏ company͏͏ reported͏͏ revenue͏͏ of͏͏ INR͏͏ 150͏͏ crore͏͏ in͏͏ FY23,͏͏ a͏͏ significant͏͏ increase͏͏ from͏͏ INR͏͏ 46͏͏ crore͏͏ the͏͏ previous͏͏ year.͏͏ It͏͏ also͏͏ recorded͏͏ a͏͏ net͏͏ profit͏͏ of͏͏ INR͏͏ 21.3͏͏ crore.
ChrysCapital͏͏ and͏͏ ICICI͏͏ Venture͏͏ declined͏͏ to͏͏ comment.͏͏ Theobroma’s͏͏ spokesperson͏͏ and͏͏ Belgian͏͏ Waffle͏͏ CEO͏͏ Ankit͏͏ Patel͏͏ did͏͏ not͏͏ respond͏͏ to͏͏ requests͏͏ for͏͏ information.
Continue͏͏ Exploring:͏͏ ChrysCapital senior͏͏ advisor͏͏ Ashish͏͏ Agrawal͏͏ resigns͏͏ to͏͏ launch͏͏ revolutionary͏͏ snack͏͏ venture
ICICI͏͏ Venture’s͏͏ decision͏͏ to͏͏ exit͏͏ its͏͏ seven-year͏͏ investment͏͏ in͏͏ Theobroma͏͏ coincides͏͏ with͏͏ a͏͏ surge͏͏ of͏͏ global͏͏ food,͏͏ café,͏͏ and͏͏ patisserie͏͏ brands͏͏ entering͏͏ India͏͏ or͏͏ increasing͏͏ their͏͏ store͏͏ presence.
These͏͏ include͏͏ the͏͏ Belgian͏͏ bakery͏͏ Le͏͏ Pain͏͏ Quotidien,͏͏ the͏͏ French͏͏ patisserie͏͏ chain͏͏ Ladurée,͏͏ Reliance͏͏ Brands-backed͏͏ Armani/Caffè,͏͏ Pret͏͏ a͏͏ Manger,͏͏ and͏͏ Canada’s͏͏ Tim͏͏ Hortons.
A͏͏ report͏͏ from͏͏ the͏͏ National͏͏ Restaurant͏͏ Association͏͏ of͏͏ India͏͏ (NRAI)͏͏ in͏͏ July͏͏ estimated͏͏ the͏͏ food͏͏ services͏͏ market͏͏ at͏͏ INR͏͏ 5.69͏͏ lakh͏͏ crore͏͏ for͏͏ FY24,͏͏ contributing͏͏ 1.9%͏͏ to͏͏ India’s͏͏ GDP.͏͏ The͏͏ report͏͏ projects͏͏ that͏͏ this͏͏ market͏͏ will͏͏ expand͏͏ to͏͏ INR͏͏ 7.76͏͏ lakh͏͏ crore͏͏ by͏͏ FY28,͏͏ driven͏͏ by͏͏ a͏͏ growing͏͏ middle͏͏ class,͏͏ an͏͏ increasing͏͏ tendency͏͏ to͏͏ dine͏͏ out,͏͏ aspirational͏͏ demand͏͏ from͏͏ tier͏͏ 2͏͏ and͏͏ 3͏͏ locations,͏͏ and͏͏ food͏͏ delivery͏͏ platforms͏͏ reaching͏͏ new͏͏ markets.͏͏ Additionally,͏͏ the͏͏ NRAI͏͏ report͏͏ indicated͏͏ that͏͏ the͏͏ food͏͏ services͏͏ sector͏͏ is͏͏ expected͏͏ to͏͏ grow͏͏ at͏͏ an͏͏ 8.1%͏͏ compound͏͏ annual͏͏ growth͏͏ rate͏͏ between͏͏ 2024͏͏ and͏͏ 2028.
