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News Topical, Digital Desk : Merger News: Merger talks between Devyani International, the largest operator of food brands like KFC and Pizza Hut in India, and Sapphire Foods have now reached the final stage.
Sources familiar with the matter said that upon completion, the entire Indian KFC and Pizza Hut network will be integrated under a single platform.
Together, the two companies operate over 3,000 outlets across the country and are considered the backbone of Yum Brands' presence in India. According to sources, Yum Brands is driving the consolidation and encouraging both franchisees to agree on an integrated structure to strengthen supply chain efficiency and operational planning. The structure currently being considered involves merging Sapphire Foods with Devyani International, with Devyani remaining the listed company after the merger. However, the most sensitive aspect of the deal is the swap ratio.
- Devyani has proposed a ratio of 1:3,
- Whereas Sapphire is demanding a ratio of 1:2.
- According to sources, this is the most “sensitive” phase of the ongoing negotiations on valuation.
- Talking about the financial situation, both the companies are currently running in losses.
- Devyani reported a net loss of ₹23.9 crore in the September 2025 quarter.
- Sapphire Foods' loss stood at ₹12.8 crore during this period.
Market analysts believe that despite losses, the combined size of the two companies' networks could create cost synergies that neither company could achieve independently.
Operationally, Devyani currently operates 2,184 outlets under its own brands, while Sapphire has around 1,000. A merger would create one of the largest QSR (Quick Service Restaurant) networks in India, providing strong negotiating power over rentals, logistics, and procurement. CNBC-TV18 has sought comment from Devyani International, Sapphire Foods, and Yum Brands. Responses are awaited.
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