Dubai-based private equity firm Gateway Partners has acquired a 40% stake in the Gulf franchise of coffee and breakfast chain Tim Hortons, two sources familiar with the matter told Reuters.
Gateway Partners, which is led by former Standard Chartered banker Viswanathan Shankar, paid about $50 million for the holding, the sources, who declined to be named, said.
Gateway declined to comment.
The franchise is owned and managed by Dubai-based fashion and lifestyle retail conglomerate Apparel Group.
Apparel's chairman Nilesh Ved confirmed Gateway's investment, which he said would be used to grow the business, but declined to discuss the value or size of the deal.
"We are going to take it to Egypt and India and expand in the Gulf," Ved told Reuters by telephone.
Gateway Partners made the investment through its Gateway Fund 1 in February, information contained on its website shows.
The website describes the Tim Hortons regional business as the chain's leading franchise outside of North America, with 141 stores as of the end of last year across the Middle East.
Cafes and restaurants have been closed for eating-in across the Gulf after a lockdown to contain the coronavirus outbreak.
Ved said six or seven Tim Hortons outlets remain open for deliveries to customers in Dubai and 15 are doing business in Saudi Arabia, through the use of third party delivery apps.
"At this moment no-one knows exactly what's happening. People are just tired of sitting at home. It will take some time, but eventually people will want to go out for that coffee and go to the mall," he said.
Prior to the coronavirus crisis and rules that restrict movement of people across the Gulf, Ved said Apparel had planned to open another 300 Tim Hortons outlets in the next three years.
"It's a competitive market, but there's still room for good players to grow," he said.