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Business Standard
3 days ago
- Business
- Business Standard
Jubilant Bhartia eyes ₹5,650 cr NCDs to fund 40% stake in Coca-Cola deal
The Jubilant Bhartia Group is gearing up to raise over ₹5,650 crore through non-convertible debentures (NCDs) issued by two group companies, to help finance its ₹12,650 crore acquisition of a 40 per cent stake in Hindustan Coca-Cola Holdings Pvt Ltd (HCCH), Coca-Cola's largest bottling partner in India, according to a report by The Economic Times. Jubilant Beverages Ltd, a subsidiary of Jubilant Bhartia Group, plans to issue ₹2,650 crore in fully paid-up, unsecured, rupee-denominated, listed-rated, redeemable NCDs, the news report said. The offering will be split into ₹795 crore from anchor investors and ₹1,855 crore from a broader market tranche. Separately, Jubilant Bevco Ltd aims to raise ₹3,000 crore through a similar bond issuance, including ₹900 crore from anchor subscriptions and ₹2,100 crore from other investors. Zero-coupon structure and step-up clause Both NCD issuances are structured as zero-coupon instruments with tenures of two years, 11 months, and 27 days. They offer annualised implied yields of 9 per cent for Jubilant Beverages and 9.15 per cent for Jubilant Bevco. The bonds include a step-up clause: in the event of a credit rating downgrade, the internal rate of return will increase by 25 basis points. Instead of periodic coupon payments, investors will receive a redemption premium at maturity. Public issue opens on June 4 For Jubilant Beverages Ltd, six anchor investors — including HDFC Mutual Fund, Nippon India Mutual Fund, Franklin Templeton Mutual Fund, Aditya Birla Sun Life Mutual Fund, Axis Mutual Fund, and Nomura Fixed Income Securities Ltd — have committed ₹795 crore, The Economic Times report said. Financing the HCCH acquisition Proceeds from the NCDs will contribute to financing the group's acquisition of HCCH, which was announced in December 2024 and received Competition Commission of India approval on May 1 this year. Under the deal structure, Jubilant Beverages Ltd will acquire equity shares from Coca-Cola entities, while Jubilant Bevco and an investor consortium will subscribe to compulsorily convertible preference shares (CCPS) in Jubilant Beverages Ltd. The funding package comprises ₹5,650 crore of debt from the NCDs, CCPS from private capital providers, and an equity infusion from Jubilant Bhartia's holding company, JBCL. The deal values Hindustan Coca-Cola Beverages at an enterprise value of ₹31,250 crore. Dunkin' Donuts, Hong's Kitchen expansion stalled Meanwhile, Jubilant FoodWorks Ltd, which operates Domino's Pizza in India, has put expansion plans for Dunkin' Donuts and Chinese fast-casual brand Hong's Kitchen on hold to focus on its core brands amid the group's acquisition of HCCH. Jubilant FoodWorks Ltd has engaged EY to restructure and streamline the business and is also exploring the possibility of selling franchise rights for some of its smaller brands in India, the report said.
Time of India
3 days ago
- Business
- Time of India
Jubilant Bhartia plans Rs 5,600 crore bond issue to fund Coca-Cola deal
Jubilant Bhartia Group is looking to raise over ₹5,650 crore through non-convertible debentures ( NCDs ) across two group entities to part-fund its ₹12,650 crore acquisition of a 40% stake in Hindustan Coca-Cola Holdings Pvt Ltd (HCCH), the parent of Coca-Cola 's largest bottling partner in India. Jubilant Beverages Ltd will issue ₹2,650 crore in fully paid-up, unsecured, rupee-denominated, listed-rated, redeemable NCDs, according to people familiar with the matter. The offering will include ₹795 crore from anchor investors and ₹1,855 crore via a non-anchor tranche. Separately, Jubilant Bevco Ltd is raising ₹3,000 crore through a similar bond issuance. Step-up Clause This includes ₹900 crore from anchor subscriptions and ₹2,100 crore from the wider market. Both bond issuances are structured as zero-coupon instruments with tenures of two years, 11 months, and 27 days. They offer implied annualised yields of 9% for Jubilant Beverages and 9.15% for Jubilant Bevco. The NCDs feature a step-up clause that increases the internal rate of return by 25 basis points in the event of a credit rating downgrade. Instead of periodic coupons, a redemption premium will be paid at maturity. The public issuance opens on June 4. Eight anchor investors have committed ₹900 crore in the Jubilant Bevco tranche. These include HDFC Mutual Fund, Nippon India Mutual Fund, Franklin Templeton Mutual Fund, Aditya Birla Sun Life Mutual Fund, Axis Mutual Fund, Kotak Mahindra Mutual Fund, Nomura Fixed Income Securities Ltd., and Bajaj Finance Ltd. There are six anchor investors, including HDFC Mutual Fund, Nippon India Mutual Fund, Franklin Templeton Mutual Fund, Aditya Birla Sun Life Mutual Fund, Axis Mutual Fund, Nomura Fixed Income Securities Ltd., who have committed ₹795 crore in the Jubilant Beverages Ltd. issue. The proceeds will help finance the acquisition of HCCH by the Jubilant Bhartia Group and funds managed by Goldman Sachs Asset Management. The deal was announced in December 2024 and received approval from the Competition Commission of India on May 1, 2025. Under the transaction structure, Jubilant Beverages Ltd. will acquire equity shares from Coca-Cola entities, while Jubilant Bevco and the investor consortium will subscribe to compulsorily convertible preference shares (CCPS) in Jubilant Beverages Ltd. The funding mix includes ₹5,650 crore of debt, CCPS from private capital providers, and the remainder via equity infusion by Jubilant Bhartia's holding company, JBCL. The transaction pegs the enterprise value of Hindustan Coca-Cola Beverages at ₹31,250 crore. JUBILANT STALLS PLANS Separately, Jubilant FoodWorks Ltd (JFL), operator of Domino's Pizza, has stalled the expansion of global coffee and doughnut chain Dunkin' Donuts and Chinese fast casual brand Hong's Kitchen, to focus on its other larger brands Domino's Pizza and Popeyes, amid the group's acquisition of HCCB. JFL, India's largest food services operator, has roped EY to restructure and streamline the business, as well as explore the possibility of selling off franchisee rights of some of its smaller brands such as Hong's Kitchen and Dunkin' Donuts in India, people directly aware of the development said. "We have already taken the stance of curtailing any or not doing any expansion in Dunkin' and Hong's," Sameer Khetarpal, managing director of Jubilant FoodWorks told analysts on a post Q4 investor call last week. Domino's Pizza's store count stood at 2,179 restaurants in India across 475 cities as of March 31, '25 . In contrast, there are 31 Dunkin' stores in 14 cities as of March 31, '25, as per JFL's website. JFL had opened its first Dunkin' Donuts in India in 2012, and expanded to over 70 stores rapidly. "However, since then, the chain has shut down most of its unprofitable stores to curtail fixed operating costs and overheads amid subdued sales, and instead focused on smaller and kiosk format outlets," one of the executives said. Jubilant Bhartia Group, JFL and EY did not respond to email queries. For the January-March '25 quarter, Domino's India reported like-for-like year-on-year growth of 12.1%, while at an overall group level, JFL reported revenue growth of 19% year-on-year."Execution on pricing, delivery time and product innovation drove order growth of 25%-plus year-on-year. Key downside risks are raw material costs turning inflationary and higher than expected increase in competitive intensity," ICICI Securities wrote in a report on May 15.
Economic Times
3 days ago
- Business
- Economic Times
Jubilant Bhartia plans Rs 5,600 crore bond issue to fund Coca-Cola deal
Agencies Live Events (You can now subscribe to our (You can now subscribe to our ETMarkets WhatsApp channel Mumbai: Jubilant Bhartia Group is looking to raise over ₹5,650 crore through non-convertible debentures ( NCDs ) across two group entities to part-fund its ₹12,650 crore acquisition of a 40% stake in Hindustan Coca-Cola Holdings Pvt Ltd (HCCH), the parent of Coca-Cola's largest bottling partner in Beverages Ltd will issue ₹2,650 crore in fully paid-up, unsecured, rupee-denominated, listed-rated, redeemable NCDs, according to people familiar with the offering will include ₹795 crore from anchor investors and ₹1,855 crore via a non-anchor Jubilant Bevco Ltd is raising ₹3,000 crore through a similar bond includes ₹900 crore from anchor subscriptions and ₹2,100 crore from the wider bond issuances are structured as zero-coupon instruments with tenures of two years, 11 months, and 27 days. They offer implied annualised yields of 9% for Jubilant Beverages and 9.15% for Jubilant Bevco. The NCDs feature a step-up clause that increases the internal rate of return by 25 basis points in the event of a credit rating downgrade. Instead of periodic coupons, a redemption premium will be paid at public issuance opens on June 4. Eight anchor investors have committed ₹900 crore in the Jubilant Bevco tranche. These include HDFC Mutual Fund, Nippon India Mutual Fund, Franklin Templeton Mutual Fund, Aditya Birla Sun Life Mutual Fund, Axis Mutual Fund, Kotak Mahindra Mutual Fund, Nomura Fixed Income Securities Ltd., and Bajaj Finance Ltd. There are six anchor investors, including HDFC Mutual Fund, Nippon India Mutual Fund, Franklin Templeton Mutual Fund, Aditya Birla Sun Life Mutual Fund, Axis Mutual Fund, Nomura Fixed Income Securities Ltd., who have committed ₹795 crore in the Jubilant Beverages Ltd. proceeds will help finance the acquisition of HCCH by the Jubilant Bhartia Group and funds managed by Goldman Sachs Asset Management. The deal was announced in December 2024 and received approval from the Competition Commission of India on May 1, the transaction structure, Jubilant Beverages Ltd. will acquire equity shares from Coca-Cola entities, while Jubilant Bevco and the investor consortium will subscribe to compulsorily convertible preference shares (CCPS) in Jubilant Beverages Ltd. The funding mix includes ₹5,650 crore of debt, CCPS from private capital providers, and the remainder via equity infusion by Jubilant Bhartia's holding company, JBCL. The transaction pegs the enterprise value of Hindustan Coca-Cola Beverages at ₹31,250 Jubilant FoodWorks Ltd (JFL), operator of Domino's Pizza, has stalled the expansion of global coffee and doughnut chain Dunkin' Donuts and Chinese fast casual brand Hong's Kitchen, to focus on its other larger brands Domino's Pizza and Popeyes, amid the group's acquisition of HCCB. JFL, India's largest food services operator, has roped EY to restructure and streamline the business, as well as explore the possibility of selling off franchisee rights of some of its smaller brands such as Hong's Kitchen and Dunkin' Donuts in India, people directly aware of the development said."We have already taken the stance of curtailing any or not doing any expansion in Dunkin' and Hong's," Sameer Khetarpal, managing director of Jubilant FoodWorks told analysts on a post Q4 investor call last Pizza's store count stood at 2,179 restaurants in India across 475 cities as of March 31, '25 . In contrast, there are 31 Dunkin' stores in 14 cities as of March 31, '25, as per JFL's website. JFL had opened its first Dunkin' Donuts in India in 2012, and expanded to over 70 stores rapidly. "However, since then, the chain has shut down most of its unprofitable stores to curtail fixed operating costs and overheads amid subdued sales, and instead focused on smaller and kiosk format outlets," one of the executives Bhartia Group, JFL and EY did not respond to email the January-March '25 quarter, Domino's India reported like-for-like year-on-year growth of 12.1%, while at an overall group level, JFL reported revenue growth of 19% year-on-year."Execution on pricing, delivery time and product innovation drove order growth of 25%-plus year-on-year. Key downside risks are raw material costs turning inflationary and higher than expected increase in competitive intensity," ICICI Securities wrote in a report on May 15.
