ICICI Venture Ltd, India’s leading private equity fund, has acquired 10 per cent stake in Gurgaon-based fast food & merchandise retail chain Devyani International Ltd, for a total consideration of $55.70 million.

Devyani International owns and operates fast food retail chains including Pizaa Hut, KFC and UK-based coffee chain Costa Coffee, and also runs Disney Artist outlets in India. The company is a subsidiary of RJ Corporation which is engaged in diversified businesses such as beverages & breweries, fast food joints, dairy products, education, healthcare and hospitality.

DIL, which had recently introduced its first south Indian restaurant Vaango, announced that it would invest $22.2 million in 2011 to open more than 100 outlets across all its brands. Incidentally, there will be 15 such outlets in Delhi-NCR region. The company is likely to go for an IPO during the third quarter of FY11.

ICICI Venture Ltd, a PE firm with over $2 billion assets under management, invests in manufacturing, IT, healthcare, pharmaceuticals, biotechnology, media, financial services and retail sectors.

Similar deals had recently taken place in the fast food and restaurant space. For instance, in 2010, Kohlberg Kravis Roberts (KKR), New Silk Route and Standard Chartered Private Equity had acquired 20 per cent stake in Bangalore-based Coffee Day Resorts & Hotels Ltd for a price of $200 million. The company is using the fund to increase the number of retail outlets and also add international locations to its portfolio in Austria, Pakistan and Dubai.

Recently, TVS Shriram Growth Fund, managed by TVS Capital Funds Ltd, has invested an undisclosed amount in Indian Cookery Pvt Ltd which owns multiple Indian cuisine restaurant brands. The proceeds are being used to open 300 outlets over the next five years. The fund has made another investment of $11.1 million in Gurgaon-based Om Pizzas & Eats Pvt Ltd in 2010.

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