Mumbai: Homegrown private equity firm ChrysCapital is poised to acquire a controlling stake in bakery chain Theobroma Foods for ₹2,200-2,300 crore, two people aware of the development said. The deal will see the complete exit of ICICI Venture, which invested in the company in 2017.
Theobroma founder Kainaz Messman and family may retain around 10% stake in the 194-store bakery network, the people cited above said on the condition of anonymity. Messman, earlier a pastry chef at Oberoi Hotels, had founded the bakery chain as a single outlet in Mumbai’s Colaba Causeway in 2004.
“The deal is likely to be signed in a fortnight. ChrysCapital will buy around 90% stake with an option to acquire more going forward,” one of the people cited above said.
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ICICI Venture bought a significant minority share in the food services company in 2017 for about $20 million. The funds were infused in two equal tranches, of which the first instalment was used to expand the brand to Delhi-NCR, and expand its presence in Mumbai and Pune. Tracxn data shows its FY24 revenue at $54.6 million, up from $41 million in FY23.
Mint first reported in January 2024 that Theobroma shareholders were scouting for buyers.
ICICI Venture owns around 42% stake in the chain. Several other PE firms including Bain Capital and Carlyle Group also had placed bids, having set their hearts on owning a slice of Theobroma Foods. However, talks stalled for many months because of a valuation mismatch, the second person cited above said.
Queries emailed to ICICI Venture and ChrysCapital remained unanswered. Messages sent to Messman too went unanswered.
“ChrysCapital re-engaged with the company, and the management and is likely to now go ahead with the deal at a lower valuation than the promoters expected,” the second person added. The earlier deal negotiations revolved around a valuation of ₹3,000 crore.
Consumer foods market
For ChrysCapital, this will be the first transaction in the consumer foods sector. It had previously invested in Wow Skin Care and kids’ retailer FirstCry. Chrys Capital has also built deep expertise in pharmaceuticals segment. Armed with a $2.2 billion new fund that it raised earlier this year, ChrysCapital is looking to write larger cheques and build a bigger portfolio in India.
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According to a report by IMARC Group, a research firm, the Indian bakery market size reached $13.8 billion in 2024. “Looking forward, IMARC Group expects the market to reach $31.5 billion by 2033, exhibiting a growth rate (CAGR) of 9.12% during 2025-2033,” the report said. As per the report, the growing population and changing consumer preferences, driven by factors such as western food trends, increased consumption of cakes and RTE food, and expanding retail and e-commerce sectors, are fueling the market growth/demand. This, in turn, is prompting manufacturers to introduce healthier options and invest in R&D to meet the evolving consumer demand.
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