Sodexho picks controlling stake in Radhakrishna Hospitality Services

Multinational food service major, Sodexo, picked up a majority stake in Radhakrishna Hospitality Services-the country's largest food service firm- in a deal to the tune of Rs 400 crore. The company is expected to make an official announcement regarding the deal later in the day. Both Sodexo and Radhakrishna Hospitality Services confirmed the deal. ET the first to report about this deal had reported about the deal in the making, in early this year.

Radhakrishna hospitality is the only organised player in the domestic food service space and is growing at a healthy 30%. Banking industry confirmed to ET that the promoters of Radhakrishna Hospitality sold controlling stake at Rs 400 crore, which mirrors the current revenue size of the catering business.

The company had earlier tried to rope in financial investors but couldn't do so due to differences with potential investors over pricing. The current deal is only for Radhakrishna Hospitality's core business of food catering. The talks, however, don't include the other businesses, such as supply chain and retail businesses, which are under RK Foodland.

Radhakrishna Hospitality has been talking to potential suitors for some time now. Last year, Radhakrishna Hospitality purchased the stake owned by Compass, a US-based food service firm, in a joint venture and is in the process of rolling out its international catering services.

"Radhakrishna hospitality was very strong in the international markets during 1989-99. We want to re-enter the international markets and scale up the intrinsic value offered by our brand in the global arena," top company officials told ET.