ICICI Venture will invest $20 million to acquire a significant stake Theobroma. The alternate investment arm of top private sector lender ICICI BankBSE -0.92 % and the leading bakery chain will ink a deal to formalise the transaction, sources with direct knowledge of the matter told ET.
The investment will mark the third transaction from the homegrown PE firm’s latest fund, ‘India Alternate Fund 4.’ Early last year, ICICI Venture announced its first close of $190 million, subsequently reached $350 million with the participation of a large global sovereign wealth fund and a leading European institution.
Theobroma was launched by Kainaz Messman Harchandrai, a former pastry chef at the Oberoi Udaivilas hotel in Udaipur, in 2004. It offers a range of products that include chocolates, cookies, pastries, and toffees. The bakery chain’s professional CEO, Cyrus Shroff, a former top executive at US private equity firm KKR & Co, joined the Theobroma in 2015.
Theobroma has 15 outlets and is present in Mumbai and recently launched in the national capital region. It has centralized production facilities for each city with a high takeaway ratio and low capex per outlet upping profitability. Over the last decade, the bakery chain has built a strong brand with high customer loyalty and repeat customer visits.
In a sector with a large number of unorganized players, private equity investors continue to explore investments based on the premise that organized sector players can grow market share rapidly.
Both ICICI Venture and Theobroma declined to comment on the investment.
ICICI Venture is one of the largest alternative assets managers in India with close to $ 4.15 billion under management across four platforms. These include $ 1.85 billion in private equity, $ 850 million in under the power platform launched in joint venture with Tata Power, more than $ 1billion in AION (a special situations fund in joint venture with Apollo Global Management) and $ 630 million in real estate.
Source: Economic Times