Barely a year after it acquired Barista Coffee, debt-laden auto component maker Amtek Group is looking to sell off the loss-making coffee chain pioneer.
Amtek may bring in consultancy firm Grant Thornton to look for potential buyers for Barista, it has not been given the signed mandate yet. “The deal could also be structured in a way that the Arvind Dham-promoted Amtek Auto could liquidate about a third in Carnation Hospitality, which manages Amtek’s food business,” said a source.
Dham had recently announced the group’s decision to offload non-core assets and exit non-auto businesses, after the firm defaulted on repayment of INR 800 crore.
Amtek is the fourth owner of Barista Coffee, the oldest among India’s private coffee chains, and the potential sale points to not only Amtek’s cash crunch problems but also the struggle in the country’s coffee chain industry where most players are struggling to make profits.
Most of Barista Coffee’s 170-plus stores are loss making, though in terms of store count, Barista continues to be the country’s second-largest cafe chain after Cafe Coffee Day. Other big players in India’s estimated INR 1,400 crore cafe business with over 3,100 branded outlets, include Starbucks and Costa Coffee. Carnation Hospitality, a wholly owned subsidiary of Amtek Group’s listed firm Rollatainers, had bought out Barista coffee for INR 100 crore from Italian coffee firm Lavazza Spa.
