Temasek Eyes 25% Stake In Rebel Foods Ahead Of IPO

SUMMARY

A clutch of early investors in Rebel Foods, including Lightbox and Peak XV, are selling their shares and partly diluting their stake

Their shares, representing a 20-25% stake in Rebel Foods, will be mopped up by Temasek for $180-200 Mn

Rebel Foods is planning to float an IPO in the next 12-18 months

Singapore state investor Temasek Holdings is looking to acquire a significant stake in Rebel Foods via a mix of primary equity infusion and secondary share sale as the homegrown cloud kitchen unicorn prepares to go public.

Early investors in Rebel Foods — Coatue Management, Lightbox and Peak XV — are selling shares and partly diluting their stakes ahead of the startup’s initial public offering (IPO) slated for the next 12-18 months, Mint reported.

Their shares, representing a 20-25% stake in Rebel Foods, will be mopped up Temasek’s subsidiary Jongsong Investments for around $180-200 Mn (approx. INR 1500-1680 Cr), the report said.

Inc42’s queries to Rebel Foods did not elicit any response till the time of publishing the story.

It should be noted that if the deal goes through, Temasek will become the largest shareholder in Rebel Foods. The founders currently own a 12% stake in the company, while Qatar Investment Authority holds around 10%.

As per the report, Rebel Foods plans to use the fresh funds to expand its food court business, EatSure.

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

The startup primarily earns revenue from the sale of food items through its own cloud kitchens as well as those owned by third parties. It also earns via delivery charges and royalties through partnerships with other partners.

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.

Its operating revenue jumped 19% to INR 1,420.2 Cr in FY24 from INR 1,195.2 Cr in FY23.

The second stake purchase in Rebel Foods 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, Swiggy and Lenskart have all seen secondary transactions in the run up to their IPOs, giving partial exits and multi-bagger returns to some early backers.