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Shankar Somasundaram
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SS Equity Holdings Ltd., linked to high net worth individual investor Shankar Somasundaram, has acquired the BreadTalk franchise for Rs. 245 million.
The acquisition is via FoodBuzz Ltd., the subsidiary of RIL Property PLC. BreadTalk has 10 outlets in the country. Somasundaram is regarded as one of the most successful investors. He founded Lanka Bell and was a leading shareholder of Brown and Company, among others.
RIL said it has transferred the entire equity of 108.18 million shares in FoodBuzz to SS Equity.
“The divestment is in line with the company’s strategic investment activities and helps streamline its resources and business structure,” RIL said.
The move comes after in March RIL said it was in the process of negotiations with a potential investor after an initial plan to temporarily close all BreadTalk outlets was suspended.
As at 31 March, FoodBuzz had assets worth Rs. 437.5 million including Rs. 219 million in property, plant and equipment and intangible assets) and liabilities of Rs. 177.5 million (including Rs. 110 million in lease liabilities).
Due to the COVID-19 pandemic-induced lockdowns, BreadTalk revenue in FY21 declined by 60% to Rs. 170 million from Rs. 413 million in FY20. Loss from operating activities rose to Rs. 85.5 million from a loss of Rs. 26 million in FY20.Loss before tax was Rs. 185.4 million up from Rs. 42.4 million loss.
