Compass Group to acquire Elior India Catering Business
New Delhi: The Compass Group India, a wholly owned subsidiary of UK-based Compass Group is close to finalising the acquisition of Elior India’ s catering business which employs over 1000 employees and has a revenue of nearly 150 crores. Our sources tell us the deal will be a slump sale on cash free debt free basis. With this acquisition the Compass group will become Indias largest corporate catering player.
Elior entered India in late 2016 through two acquisitions — a majority stake in Chennai-based CRCL and 100 percent acquisition of the Bengaluru-based Megabite Food Services. Last year the company exited the joint venture with CRCL and has since been looking to exit its Megabite business as well.
The Compass Group, which has been operational in India since 2008, is actively expanding its business in India into new verticals and new territories. Last year the company had acquired a majority stake in SmartQ, a payment platform which provides digital services for cafeterias.
Sources tell us that this sale is strategically important for the Elior as it will help the group complete its plans to exit India and cut its losses here while also saving significantly on litigation costs that it is currently incurring in its ongoing battle with the former CEO.
The transaction with Compass is expected to conclude sometime next week. It appears that Sodexho and Foodlinks too were keen to acquire Elior’s India business but for some reason shied away from the transaction.
The acquisition of Elior India’s business by the Compass group will be its first acquisition in the corporate catering business India after nearly a decade even though its CEO Dev Amritesh is moving on from the company after having spent nearly five years there. Our sources confirm that a new CEO has since been identified and is expected to join early next year.