Jubilant Foodworks Ltd announced plans to acquire an additional 51.16 per cent stake in DP Eurasia NV, the exclusive master franchisee of the Domino’s Pizza brand in Turkey, Azerbaijan, and Georgia.
The acquisition will be carried out through a subsidiary, with a proposed consideration of up to EUR 73.36 million (approximately Rs 670 crore).
Jubilant Foodworks Netherlands B.V (JFN), a wholly-owned arm of the company, currently holds 48.84 per cent of the ordinary shares of DP Eurasia, making it the largest pizza delivery company in Turkey. The acquisition aims to increase JFN’s stake by purchasing the entire issued and outstanding ordinary share capital of DP Eurasia NV not already held by it, at a price of up to 85 pence per share from existing shareholders.
The aggregate purchase consideration for the acquisition is set at approximately EUR 73.36 million, with the transaction being an all-cash deal. DP Eurasia operates a substantial business with 694 stores (678 in Turkey, 10 in Azerbaijan, and 6 in Georgia as of October 31, 2023), predominantly following an asset-light and scalable model through franchised stores.
In terms of funding the acquisition, JFN plans to utilize an existing term-loan facility from HSBC, backed by a corporate guarantee issued by Jubilant Foodworks Ltd. Additionally, a new long-term facility from HSBC, again backed by a corporate guarantee from JFL in favor of HSBC, will be availed. JFL will guarantee the repayment obligations of JFN towards HSBC, amounting to EUR 60 million, in addition to the existing guarantee of EUR 45.89 million issued by JFL for securing the repayment obligations of the existing term-loan facility.
This strategic move positions Jubilant Foodworks for an increased presence in the pizza delivery sector, particularly in Turkey, Azerbaijan, and Georgia, through its strengthened association with DP Eurasia NV.
Source: Economic Times