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Yum! Brands is reportedly exploring the possibility of merging its two key franchise partners in India, Devyani International and Sapphire Foods India, according to The Economic Times. Both companies are listed and operate within the quick service restaurant (QSR) segment, managing popular chains such as KFC, Pizza Hut, and Taco Bell in India and select international markets.
Sapphire Foods currently operates KFC, Pizza Hut, and Taco Bell outlets, while Devyani International also runs KFC and Pizza Hut restaurants and is considered the largest Yum! Brands franchisee in India.
Sources cited in the ET report suggest that Yum! Brands is facilitating discussions that may lead to Sapphire Foods merging into Devyani International. One potential scenario under review includes Devyani International acquiring Sapphire’s franchise rights for KFC and Pizza Hut or consolidating all of KFC’s Indian outlets under its brand umbrella.
A person familiar with the matter indicated that a potential share swap ratio of 1:3 is being considered, meaning Sapphire shareholders would receive one Devyani International share for every three they hold. This detail, however, has not been independently confirmed by ET.
Devyani International, part of Ravi Jaipuria’s RJ Corp, saw its shares rise by 2.50 percent on Friday morning, trading at Rs 171.15. The company, a constituent of the BSE 500 index, holds a market capitalization of Rs 20,678 crore. RJ Corp also controls Varun Beverages.
Meanwhile, Sapphire Foods, which also features on the BSE 500 index, recorded a 9.50 percent surge in its stock price, reaching Rs 351. The company has a market valuation of Rs 11,274 crore.
As of March 31, 2025, Devyani International operated more than 2,030 outlets across India, Thailand, Nigeria, and Nepal. Sapphire Foods managed 963 restaurants across India and Sri Lanka under the KFC, Pizza Hut, and Taco Bell brands.
A possible merger could significantly alter the competitive landscape of India’s QSR industry, creating a single entity under Yum! Brands' franchise network with a broader geographic and operational footprint.
