Date of original investment: 2008
Deal type: Management buy-out
Hunched over a steaming hotpot, diners at Beijing’s Xiabu Xiabu, China’s most popular hotpot restaurant chain, savour the taste of this warming favourite that combines traditional cuisine with the speed of fast-food.
With rising disposable income, the country’s catering market has grown significantly, as Chinese consumers choose to eat out more often. Xiabu has benefited from this trend and grown rapidly. It pioneered the individual, bar-style hotpot format, in place of the usual communal hotpot, and restaurants have sprung up in office blocks and shopping malls, attracting crowds of white collar diners looking for affordable, healthy food.
When Actis invested in Xiabu in 2008 it had 60 restaurants. The original goal was to triple this number over the following three years. But by the end of 2011, the chain had already reached over 200 outlets. Today, Xiabu has over 300 outlets.
Xiabu employs about 10,000 people; the majority of its branches are in Beijing, and increasingly Shanghai, where it opened five stores on the same day in September 2010 achieving a PR tour de force. To better serve its growing restaurant network in the capital, Xiabu built a new centralised kitchen in Beijing. Xiabu has become the No.2 chain restaurant in Beijing, only behind KFC. It was awarded as “Top Ten Famous Brands” in Beijing in 2010.
As well as continuing to extend the chain’s footprint, Actis worked with Xiabu’s Quality Assurance Director to uphold international standards in health and safety management and ensured that the new central kitchen was constructed according to HACCP and ISO22000 guidelines. In 2010, Xiabu was placed third in the Zero2IPO Venture 50 Awards, which recognise top PE-backed businesses in China.
Actis exited Xiabu Xiabu in December 2012.