Devyani International Ltd. and Sapphire Foods India Ltd. announced a merger valued at $934 million to create a leading entity in India's quick-service restaurant market.

Information on the Target

On January 1, 2026, a significant merger was announced between two of India’s largest quick-service restaurant (QSR) franchise operators, Devyani International Ltd. and Sapphire Foods India Ltd. This landmark deal, valued at approximately $934 million, will combine the strengths of both companies, resulting in a formidable entity operating over 3,000 KFC and Pizza Hut outlets throughout India and selected international markets. The merger not only consolidates restaurant counts but aims to harness operational scale, enhance profitability, and drive sustainable long-term value for shareholders in a historically challenging industry.

The transaction is structured as a share-swap agreement whereby Devyani International will issue 177 of its equity shares for every 100 shares held by Sapphire Foods shareholders, thereby dissolving Sapphire Foods as a standalone company. Following the transaction, Devyani will emerge as the listed parent company, and this alignment between equity valuations is designed to minimize arbitrage opportunities for investors.

Industry Overview in India

India's quick-service restaurant industry has undergone rapid growth, driven by urbanization, changing consumer preferences, and an upsurge in disposable income. However, despite this growth, the industry faces significant challenges, including