William Bissell, managing director of ethnic apparel retailer Fabindia, has invested Rs 3 crore (around $450,000) in quick service restaurant (QSR) chain Wow! Momo, a person familiar with the development told VCCircle.
Bissell, according to the person mentioned above, has picked up 1% stake in the Kolkata-headquartered firm via the transaction, which valued Wow! Momo Foods Pvt. Ltd at Rs 300 crore (around $45 million).
Wow! Momo founder Sagar Daryani confirmed that Bissell had invested in the firm and also the valuation, but did provide specific numbers.
He added that as part of the deal, Bissell will join the company’s board of advisors.
The QSR chain will primarily use the money to expand its bases, the above-mentioned person added.
Email queries sent to Fabindia did not elicit a response till the time of publishing this report.
The Economic Times had reported on the development earlier in the day and pegged the deal size at Rs 3-4 crore.
MP Law Offices is said to have been appointed as the legal adviser to Bissell for this transaction.
Wow! Momo had in May last year roped in mid-market private equity firm Lighthouse Advisors India Pvt. Ltd as its first institutional investor. Lighthouse is also a minority investor in Fabindia.
The QSR chain was valued at Rs 230 crore at the time of that investment, according to VCCEdge, the research arm of News Corp VCCircle.
The company, which was founded in 2008 by Daryani and Binod Homagai, has more than 120 outlets across Kolkata, Bengaluru, Pune, Delhi, Chennai and Kochi.
Wow! Momo had posted net sales of Rs 49 crore in the financial year 2016-17, up from Rs 31 crore the year before that. Its net profit rose to Rs 1.2 crore from Rs 60 lakh during the same period.
In 2016, the restaurant chain had raised 7.9 crore in debt from private-sector lender Bandhan Bank.
That round, which included a cash credit facility of Rs 1 crore, was supposed to be used to set up the restaurant’s back-end infrastructure in Kolkata and for opening new stores.
It had also previously raised Rs 10 crore from the Indian Angel Network in 2015. Sanjeev Bikhchandani, Saurabh Shrivastava and Ashvin Chadha were the lead IAN investors in that round, which had valued the QSR chain at Rs 100 crore.
In June last year, VCCircle reported that a clutch of investors from IAN had walked away with a bountiful harvest from their one-and-half-year-old investment in Wow! Momo.
Deals in the space
There have been a few deals in the QSR space over the past year or so.
Last month, Charcoal Eats, which offers all-day food options at various price points, raised Rs 5 crore ($742,000) in its pre-Series A round of funding from a clutch of angel investors.
In the same month, Yellow Tie Hospitality Management LLP, a food and beverage franchise management company, acquired a controlling stake in three quick-service restaurant brands—Umraan, Wok This Way and Health Juice Centre.
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