Burger King India Ltd. has announced that it has entered into a share purchase agreement with PT Sari Burger Indonesia (BK Indonesia) to acquire an 83.24% stake from existing shareholders of the latter.
BK Indonesia manages and operates the Burger King brand in Indonesia
Burger King India has acquired the controlling stake in BK Indonesia "at an equity value arrived at by adjusting the enterprise value of IDR (Indonesian rupiah) 2,601 billion ($183 million)" payable in one or more tranches.
Burger King India's board of directors considered and approved the acquisition of a controlling stake in BK Indonesia at a meeting held on December 15.
The completion of the deal "is subject to fulfillment of certain conditions precedent including the receipt of the approval of the shareholders of the company," Burger King India said in a statement.
Post the completion of the acquisition of shares, Burger King India will make a fresh capital infusion in BK Indonesia "for an amount aggregating to IDR equivalent of $40 million by way of subscription to fresh shares issued by BK Indonesia, towards supporting any of its future business requirements, business expansion plans and acquisition of any other business/asset/brand."
The company believes BK Indonesia is a good fit given its experience in managing and operating the Burger King brand in India.
"The company realises the high growth potential in the Indonesian market and believes that the company can be the right partner to drive the Burger King brand in Indonesia through its next phase of growth," the statement read further.
Burger King India's shareholding in BK Indonesia will increase further subsequent to the proposed capital infusion.
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