THE Abraaj Group, a leading private equity investor operating in global growth markets, has successfully exited its investment in the restaurant chain Hot Pot, through an initial public offering (IPO) on the local Thai stock exchange that was more than three times oversubscribed. The Abraaj Group first invested in the restaurant chain in 2006. Since then, the restaurant chain's revenues have grown at an impressive compound annual growth rate of approximately 25 percent and restaurant branches have expanded from 58 to 126. The lPO is yet another successful exit for Abraaj's first South East Asia Fund. Earlier this year, the Group sold its stake in Yupi, a leading Indonesian confectionary company and exited its investment in Cirtek Electronics, a semi-conductor business, through an IPO on the Philippine Stock Exchange (PSE). The Abraaj Group's investment in the SukiShabu and international buffet restaurant group was based on an expectation that demographic trends in Thailand, combined with an explosion in disposable income among even the moderately well off, would provide a fast-growing clientele for the restaurant. Within five years of the investment, the average number of customers per month grew from 250,000 to 570,000. Abraaj's initial investment allowed Hot Pot to introduce a state-of-the-art central kitchen and cold storage facility, which transformed the business's health and safety record as well as dramatically increased productivity. Those operational improvements have allowed Hot Pot to fully establish its reputation for delivering both value and quality to its customers. Omar Lodhi, senior partner, The Abraaj Group, said: “Achieving such a heavily oversubscribed share offering in what has been a globally weak IPO market is a great result. It is also a good measure of the strength of the Hot Pot business that the Abraaj team helped to build.” — SG
