Aditya Birla Private Equity, a part of Aditya Birla Financial Services Group, has invested $10 million in Olive Bar & Kitchen Pvt Ltd, a Mumbai-based hospitality firm which runs a chain of premium fine dining restaurants across the country. According to sources, the deal has taken six months to close and there is also a small secondary component in the transaction.
While private equity investments in the restaurant space has mainly focused on quick service restaurants, there has been increased interest in fine dining with the successful listing of Speciality Restaurants, whose offerings include Chinese cuisine restaurant Mainland China and Oh! Calcutta. Backed by PE investor SAIF Partners, Speciality’s share price went up over 50 per cent after the listing.
Among the recent investments in fine dining, Everstone Capital invested $20 million in JS Hospitality Services, which operates Pind Balluchi restaurants.
Established in 2000, Olive Bar & Kitchen has been known for its flagship fine dining brand Olive. Promoted by the renowned restaurateur AD Singh, Olive operates a chain of boutique fine dining restaurants straddling multiple genres, a high profile night club and a niche catering business across Mumbai, Delhi and Bangalore. Olive’s brand portfolio includes Olive, Monkey Bar, LAP, Ai and Soul Fry.
With the latest funding in place, the company plans to drive growth through a multi-pronged strategy that involves expansion of existing formats in new geographies and introduction of new, scalable concepts.
“Olive is one of the country’s most respected and sought-after brands in the hospitality/restaurant industry and has significant growth potential, given the buoyancy and maturing of the India consumption story,” said Samir Bahl, head of investment banking at Centrum.
Centrum Capital was the sole adviser to the company in this deal.
Bahl also added that Olive’s business has a strong cash flow in place for the next 2-3 years and would not require any additional funding. The restaurant can grow its top line by around 20 per cent for the next 3-4 years with its current cash flow, he added.
The restaurant business is increasingly becoming organised and is set to see a lot of activities in the future with a double-digit growth number. Even the established players are reorganising their existing businesses and are in the growth phase, according to Bahl.
Existing investors in Olive include Chandir Gidwani, the promoter of Centrum Group – a diversified financial services business, and Manmohan Shetty, credited with the success of Adlabs Films (now owned by Reliance ADAG) who recently founded Walkwater Media Ltd, covering myriad aspects of media and entertainment.
“Olive, led by AD Singh, has successfully created a unique identity in the Indian fine dining premium restaurant industry. It is one of the very few brands in the hospitality sector which have stood the test of time. We want to contribute towards the aggressive growth plans of the company,” said Bharat Banka, CEO of Aditya Birla Capital Advisors.
Aditya Birla PE, which focuses on growth investments in mid-market companies through two funds, invested in Olive out of the Rs 300 crore Aditya Birla Private Equity Sunrise Fund. This is the PE fund’s second deal this year after it invested around $20 million in Trimax IT Infrastructure & Services Ltd from its first fund. Last year, soon after making the first close of its Sunrise Fund, the PE firm had invested in SMS Paryavaran Ltd in its debut investment from the new fund.
(Edited by Sanghamitra Mandal)