By Hadeel Al Sayegh and Saeed Azhar
DUBAI (Reuters) – SoftBank Group Corp is in talks to invest in Dubai “cloud kitchen” Kitopi’s latest funding round through its second technology fund, sources familiar with the matter said.
The Japanese company’s Vision Fund 2 has put forward a proposal to lead an investment of about $400 million in Kitopi, said the sources, who declined to be named as the matter is not public.
SoftBank declined to comment. Kitopi also declined to comment.
So-called cloud kitchens are facilities built to prepare food specifically for delivery and they have benefited from the shift to online services during the coronavirus crisis.
These “dark”, “cloud” or “ghost” kitchens have no physical presence as a restaurant, and offer delivery-only services from a centralised location through a mobile app.
Kitopi, which is headquartered in Dubai, operates more than 60 kitchens and has more than 1500 employees.
Allied Market Research in India has estimated that the global cloud kitchen industry could be worth about $71 billion by 2027 compared with $43 billion in 2019.
Kitobi hired Bank of America earlier this year to help with the fund raising round, a source has told Reuters, expected to generate $150 million to $200 million of financing to expand into Southeast Asia.
SoftBank’s Vision Fund 2, which has targeted $108 billion in fundraising, was seeded with $38 billion from SoftBank’s own funds.
Kitopi has raised $117.2 million since its inception from investors including Dubai-based venture capital firm BECO Capital and U.S.-based Lumia Capital.
(Reporting by Hadeel Al Sayegh and Saeed Azhar. Editing by Jane Merriman)