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Nirula's on the block, but high asking price keeps buyers away
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Tuesday, 03 February, 2009, 08 : 00 AM [IST]
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Our Bureau, Mumbai
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The New Delhi-based fast food chain Nirula's is on the block again and has appointed N M Rothschild to advise it on possible sale. But potential suitors say the high asking price may be keeping buyers away, according to a report in The Economic Times. Malaysian buyout fund Navis Capital Partners owns a majority stake in Nirula's.
Nirula's managing director Samir Kuckreja, a part-owner of the company, said it had received several take-over proposals and confirmed the appointment of an investment bank to "manage such queries and explore the proposals."
According to sources, Nirula's was expecting Rs 300 crore, which was quite high. Dabur, Indian Hospitality, Thapar Group and a Dubai-based fund are sounded out to buy the 75-year-old restaurant chain. The company is expected to post an operating profit of Rs 12.5 crore in the current fiscal.
Nirula's operations are based on the franchise format. Apart from Delhi and the National Capital Region (NCR), the restaurant chain has stores in Panipat, Lucknow, Chandigarh and Agra. Its network spans 60 outlets, including dine-in-restaurants, pastry shops, ice cream parlours and coffee shops.
Reliance exits cash & carry biz
Reliance Retail has decided to exit the cash & carry business. The move is part of the company's strategy to conserve cash in a deteriorating market. Reliance Retail entered the cash & carry trading on its own in 2007 in 15 locations - mostly tier II cities like Jalandhar, Ludhiana, Rajkot and Salem, identified as initial destinations for the venture. It is believed that Reliance Retail has decided against burning cash on new business initiatives, especially on those projects where the firm is on its own. India's cash & carry market has attracted global retail giants like Wal-Mart, Tesco and Metro. They see it as an opportunity to enter India where FDI is barred in direct-to-consumer retail. Wal-Mart has forged JV with Bharti while Tesco is in alliance with Tatas to open cash & carry stores. Another global giant Carrefour is in discussions with potential local partners.
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