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Devyani International Limited and Sapphire Foods India Limited propose a merger to consolidate their Quick Service Restaurant operations in India. The transaction involves the merger of Sapphire into Devyani and the acquisition of 19 KFC restaurants in Hyderabad by Devyani from Yum Restaurants (India) Private Limited. The parties aim to achieve operational efficiencies, streamline decision-making, and improve supply chain management. The merger includes the grant of additional territory rights to Devyani by Yum group entities. The parties operate in the organized Quick Service Restaurant market across India. The transaction does not raise competition concerns in the identified relevant markets.
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Summary of the Combination
(Under Regulation 13(2) of the Competition Commission of India (Combinations) Regulations, 2024)
A. Name of the Parties to the Proposed Combination
Devyani, part of the RJ Corp Group, is a listed company on the stock exchanges in India and is primarily engaged in the business of operating restaurants and delivery outlets in the Quick Service Restaurant (‘QSR’) segment. Devyani is one of the franchisee operators of Yum! Brands Inc. in India.
Sapphire is also a QSR operator that manages and operates restaurants of KFC and Pizza Hut brand in India and operates Pizza Hut and Taco Bell outlets in Sri Lanka. Sapphire is also a listed company on the Indian stock exchanges and holds non-exclusive rights to these brands and operates numerous outlets across India and Sri Lanka.
YRIPL is indirect wholly owned by Yum! Brands, Inc., the ultimate holding company of Yum which operates and franchises QSR chains including KFC and Taco Bell across India.
B. Nature and Purpose of the Combination
Step 1: Merger
The Parties have proposed to combine operations under a single licensee entity, i.e. Devyani, and to streamline the functions and achieve operational efficiencies for the franchise outlets of KFC and Pizza Hut in India (“Proposed Transaction”).
The Proposed Transaction involves the merger of Sapphire with and into Devyani, pursuant to the amended and restated Merger Framework Agreement (“MFA”) dated August 26, 2026 and the amended draft scheme of arrangement approved by their respective board of directors on dated January 01 2026 and subsequently amended on August 26, 2026 (“Merger Scheme”).
Step 2: Merger approval, territory rights from Yum to Devyani
Step 3: Transfer of KFC Outlets from YRIPL to Devyani
As per the Yum Term Sheet, Devyani will also acquire the business of running, maintaining and operating 19 KFC restaurants in Hyderabad from YRIPL.
Key purpose of the Proposed Transaction and Other Transactions are:
C. Products, services and business(es) of the parties to the combination
Devyani: Operates KFC and Pizza Hut franchise outlets across India, and also operates KFC in Nigeria, Nepal, and Thailand. Devyani is also the exclusive franchisee of Costa Coffee, New York Fries, and Sanook Kitchen in India. In addition to the franchise brands, Devyani also owns and operates homegrown brands.
Sapphire: Operates KFC and Pizza Hut franchise outlets in India and Taco Bell in Sri Lanka.
YRIPL: runs restaurants under brands including KFC, Taco Bell etc, either directly or through franchisees.
D. Respective markets in which the parties to the combination operate
The Proposed Combination does not raise competition concerns in any plausible relevant market and therefore, the relevant market delineations may be left open. However, to aid the Hon’ble Commission in its assessment of the Proposed Combination, the following relevant markets have been identified:
E. Vertical Linkages
Upstream: distribution of beverages
Downstream: market for the provision of foods services in India
