JAKARTA, May 21 (Reuters) - Indonesian retailer Mitra Adiperkasa said it will sell majority stakes in its Domino's Pizza and Burger King chains to keep its capital to develop its other franchises.
Mitra Adiperkasa has reached an understanding with Everstone Capital, a private equity firm from Singapore, to sell a majority stake in Domino's Pizza, vice president director V.P. Sharma said on Wednesday at a public presentation.
It will keep a 49 percent stake in the pizza chain.
The company is also is talks with a number of potential buyers, including Everstone, to sell a majority stake in its Burger King franchise business.
Sharma said the fast food chains have to have about 120 outlets to give "meaningful profit" for the company but Mitra Adiperkasa has limited capital to invest in the business. Domino's Pizza now has about 60 outlets and Burger King has 48 outlets.
"Our balance sheet is already stretched. By having a strategic partner, we can invest our limited capital into other brands like Starbucks," he said.
Mitra Food and beverages contribute about 13 percent of Mitra Adiperkasa's total revenue. Its biggest contributor in the food and beverage division is Starbucks.
Most of Mitra Adiperkasa's revenue comes from its fashion franchise business, which includes brands such as Zara, Marks & Spencer Sharma said the company would release more details in the next few days. (Reporting by Fransiska Nangoy, editing by Jonathan Thatcher and Jane Merriman)
Sharma said the company would release more details in the next few days.
(Reporting by Fransiska Nangoy, editing by Jonathan Thatcher and Jane Merriman)