CCI Greenlights Temasek’s Investment In Rebel Foods

The Competition commission of India (CCI) has approved the stake acquisition of Temasek in Rebel Foods via its wholly owned subsidiary Jongsong Investments.

In a statement, the competition watchdog said that the companies proposed Jongsong subscribing to compulsorily convertible preference shares of Rebel Foods and acquiring equity shares of the cloud kitchen unicorn.

“CCI approves the proposed acquisition of shares in Rebel Foods Private Limited by Jongsong Investments Pte. Ltd,” the regulatory watchdog said in a statement.

Earlier this year, reports said that Temasek was looking to acquire a significant stake in Rebel Foods via a mix of primary equity infusion and secondary share sale.

Notably, Rebel Foods is mulling a public listing within the next 12-18 months.

Before that, early investors including Coatue Management, Lightbox, and Peak XV Partners are said to be looking for partial exits. Their combined 20-25% stake is expected to be acquired by Jongsong Investments for approximately $180-200 Mn.

Following the transaction, Temasek will emerge as Rebel Foods’ largest shareholder. Currently, the startup’s founders hold a 12% stake in it, while Qatar Investment Authority owns about 10%.

Founded in 2011 by Kallol Banerjee and Jaydeep Barman, Rebel Foods operates multiple quick-service restaurant (QSR) brands such as Behrouz Biryani, Ovenstory Pizza, The Good Bowl, SLAY Coffee, and Wendy’s.

The startup primarily generates revenue through the sale of food items via its own cloud kitchens and third-party kitchens. It also earns from delivery charges and royalties through partnerships.

Rebel Foods managed to narrow its net loss by 42% to INR 378.2 Cr in the fiscal year 2023-24 (FY24) from INR 656.5 Cr in the previous fiscal year on the back of an increase in its top line and controlled expenses. Operating revenue jumped 19% to INR 1,420.2 Cr in FY24 from INR 1,195.2 Cr in FY23.

The development comes at a time when a string of late stage Indian startups are seeing secondary share sales ahead of their planned IPOs as early backers are looking to sell some shares to eke out gains. 

Startups such as Urban Company, Acko, and Lenskart have all seen secondary transactions, giving partial exits and multi-bagger returns to some early backers.