Private-equity funds including Carlyle Group and Sequoia Capital are in separate talks to invest about $40 million to $50 million in JSM Corp, which operates the Indian franchises of Hard Rock Cafe and California Pizza Kitchen, two sources with knowledge of the matter said.
JSM Corp, which runs 12 outlets across different brands, is looking to raise capital to expand its networks and operations, said the sources, who declined to be named as the discussions are not yet public.
Premji Invest, the venture capital arm of Indian software services exporter Wipro, and New Silk Route, an Asia-focused private-equity firm, are also in talks to buy a “significant minority holding” in the company, said the sources,
JSM Corp, Premji Invest and Carlyle did not respond to emails seeking comment. Sequoia and New Silk Route declined to comment.
The company plans to set up 60-80 outlets of California Pizza Kitchen in the next three-four years, and is also looking to expand the other brands, the sources said.
Private-equity firms invested about $1.9 billion in Indian companies during the quarter ended March 2012, down about 30 percent from last year, according industry tracker, VCCircle.com due to crowded markets and higher valuations.
Private-equity funds are betting big on restaurant chains in India to capitalise on the rising spending power of the country’s increasingly wealthy new generation.
Kohlberg Kravis Roberts and Co, Standard Chartered Private Equity and New Silk Route invested in the Cafe Coffee Day chain in 2010, while ICICI Venture, the private-equity arm of lender ICICI Bank invested $33 million in Devyani International, which runs Pizza Hut, Costa Coffee and KFC in India, last year.