Devyani International, the largest franchise operator of Yum! Brands’ KFC and Pizza Hut in India, and Sapphire Foods India have agreed to merge in a transaction valued at $934 million. The combined entity will take effect on April 1, 2026, and will bring together more than 3,000 restaurants under a single franchisee, creating the largest KFC and Pizza Hut platform in the country.
Under the terms, Devyani will issue 177 shares for every 100 shares of Sapphire, giving Devyani a controlling stake in the new company. The share‑swap ratio reflects the relative market values of the two operators and is expected to be tax‑neutral for Sapphire shareholders. Integration of operations, supply‑chain systems, and brand management is slated to complete within 15 to 18 months after the effective date.
The merger will combine consolidated revenues exceeding ₹7,800 crore and is projected to generate annual synergies of ₹210–225 crore (about $25–$27 million) beginning in the second full year after completion. The scale advantage will allow the new entity to negotiate better terms with suppliers, reduce overhead costs, and accelerate the rollout of KFC and Pizza Hut outlets across India’s growing urban markets.
Management has framed the deal as a strategic move to strengthen Yum! Brands’ presence in India. Ranjith Roy, CFO of Yum! Brands, said the consolidation would unlock “greater value for both shareholder bases” through improved supply‑chain operations and a stronger market position. Ravi Jaipuria, non‑executive chairman of Devyani, highlighted the opportunity to “unlock economies of scale, strengthen supply‑chain capabilities and drive long‑term value creation.” Sumeet Narang of Samara Capital noted that the transaction reflects a shared long‑term vision between the parties and will position the combined franchisee as a dominant player against competitors such as Domino’s and McDonald’s.
Investor sentiment has been positive for the combined entity, with analysts emphasizing the scale benefits and operational efficiencies that the merger will deliver. Concerns about the share‑swap ratio have tempered enthusiasm for Sapphire, but the overall market view recognizes the strategic fit and the potential for accelerated growth in India’s fast‑food market. The transaction is subject to regulatory approvals from the Competition Commission of India, the National Company Law Tribunal, SEBI, and the stock exchanges, and is expected to close within 12 to 15 months.
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