RJ Corp to sell up to 12% in arm to fund expansion

BANGALORE: RJ Corp, the diversified firm with interests across food, beverages and retail, will dilute 10-12% equity in one of its subsidiaries to fund expansion plans. The divestment will value the subsidiary at $1 billion. “We are currently in talks with a few private equity players to dilute 10-12% in one of our subsidiaries,” RJ Corp chairman Ravi Jaipuria said on Wednesday without divulging details.

RJ Corp’s subsidiaries include Devyani International, Varun Beverages — the bottler for PepsiCo in India — Devyani Food industries, which runs ice cream venture Cream Bell as well as the joint venture with beer major Anheuser-Busch InBev, the makers of Budweiser beer.

Devyani International is the franchisee for quick-service restaurant brands such as Pizza Hut, KFC and more recently, Costa Coffee, in India and also manages a sports bar chain called Daredevils through a joint venture with the GMR Group. It is also the franchisee for in-house food retail brands.

Mr Jaipuria said the holding company RJ Corp is expected to close the calendar with a turnover of Rs 3,000-3,500 crore. A public offer for Devyani International — which is investing Rs 250 crore over the next 3-4 years to set up Costa Coffee outlets in India — is on the cards within the next 2-3 years, he added.

Through Varun Beverages, the Jaipuria family handles nearly 50% of PepsiCo’s India bottling. “We are closing in on the Sri Lanka market as well,” Mr Jaipuria said. RJ Corp has set up greenfield bottling units for PepsiCo in Zambia and Mozambique, apart from identifying Zimbabwe and Malawi as expansion markets with plans to invest around Rs 100 crore in each unit.