Devyani International Ltd (DIL), a prominent player in the quick-service restaurant (QSR) sector, has announced a significant acquisition that promises to reshape its culinary landscape. The company is set to acquire a majority stake of up to 80.72% in Sky Gate Hospitality, known for its popular brands such as Biryani By Kilo, Goila Butter Chicken, and The Bhojan, for a substantial ₹419.6 crore. This strategic move aims to fortify DIL’s footprint in the Indian food market while enhancing the variety of authentic Indian cuisine in its offerings.

Acquisition Details

In a recent regulatory filing, DIL confirmed that its board has given the green light for the acquisition. This transaction will not only involve the purchase of the stake but also include additional contingent considerations as stipulated in the transaction documents.

• Key Highlights:
  • Acquisition of up to 80.72% equity in Sky Gate Hospitality.
  • Total transaction value is ₹419.6 crore.
  • Integration of three notable brands: Biryani By Kilo, Goila Butter Chicken, and The Bhojan.

Sky Gate operates a network of over 100 outlets across more than 40 cities, specializing in the ‘handi biryani’ concept, which delivers fresh, flavorful biryani directly to consumers.

Strengthening DIL’s Portfolio

Devyani International, which operates well-known franchises like KFC, Pizza Hut, and Costa Coffee, sees this acquisition as a pivotal step toward expanding its portfolio. The integration of Sky Gate’s brands will allow DIL to cater to the growing demand for authentic Indian flavors and enhance its overall market presence.

Ravi Jaipuria, the Non-Executive Chairman of DIL, expressed enthusiasm about the acquisition, noting, "Our existing portfolio features a blend of national and international cuisines. However, we recognized the opportunity to incorporate traditional Indian flavors, which are immensely popular. Partnering with Sky Gate enables us to bring exceptional brands like Biryani By Kilo into our family, enhancing our offerings."

Vision for the Future

Sky Gate Hospitality, founded in 2015 by Kaushik Roy and Vishal Jindal, has quickly established itself in India’s dynamic food delivery scene. Both founders expressed optimism about the future, stating, "We believe our brands have found a nurturing environment for growth. Together with DIL, we can leverage our collective expertise to enhance the customer dining and delivery experience."

With this acquisition, DIL’s portfolio now boasts 10 diverse food and beverage brands, including the recently added Tealive, Sanook Kitchen, and New York Fries. The company confidently asserts that adding Biryani By Kilo, Goila Butter Chicken, and The Bhojan will further consolidate its status as one of the fastest-growing QSR chains in India.

Conclusion

This strategic acquisition not only diversifies DIL’s offerings but also positions it strongly within the competitive landscape of the Indian QSR market. As consumer preferences shift towards authentic and convenient dining experiences, DIL is well-equipped to meet these demands head-on with its enhanced brand portfolio.