Mumbai: Tata Consumer Products on Friday announced its acquisition of a complete 100% stake in Capital Foods, the company that sells products under the brands Chings Secret and Smith Jones, according to an exchange filing.
The acquisition is valued at Rs 5,100 crore and will be an all-cash transaction, according to the filing.
The Board of Directors approved the acquisition of 100 percent of the issued equity share capital of Capital Foods Private Limited. The Company, thereafter, has entered into Share Purchase Agreement (SPA) and Shareholders Agreement (SHA) with the existing promoters and shareholders of the target company to acquire the entire issued equity share capital in a phased manner, said Tata Consumer in an exchange filing.
Estimated turnover of Capital Foods for FY 23-24 is approximately Rs 750 to 770 crores.
The acquisition of 75% equity shareholding is expected to be completed on or before March 31, 2024 and the remaining 25% shareholding shall be bought within 3 years.
Chings Secret is a market leader in Desi Chinese across its product categories – Chutneys, Blended Masalas, Sauces and Soups. Smith Jones is a fast-growing brand catering to in-home cooking of Italian and other western cuisines, Tata Consumer said in a separate press release.
Tata Consumer said this acquisition will enable it to expand its product portfolio and further strengthen its pantry platform. The overall size of the categories in which Capital Foods operates in is estimated at Rs 21,400 crore.
Sunil DSouza, MD CEO, Tata Consumer Products said, We believe this is a good strategic and financial fit. It will open up significant market opportunities in the fast-growing non-Indian cuisines segment, leveraging the sales and distribution platform that we have built. The strong brand recall of Chings Secret and Smith Jones coupled with our operational strength across channels makes us extremely confident of driving topline growth and realizing cost synergies.
Ajay Gupta, Founder of Capital Foods said, Today is a historic day for Capital Foods. To be associated with the iconic Tata Group is a dream come true for me. Just the name, Tata, instils a sense of trust and pride in every Indian. Like Capital Foods, Tata is a home-grown brand that is globally recognised. Tata Consumer Products is a multiconglomerate that spans the globe with quality food ingredients and products. In 28 years, from 3 bottles of sauces, to an entire Desi Chinese cuisine block, Chings Secret has become a brand to be reckoned with. Smith Jones covers another food block with tremendous potential.
Together, Tata and Capital Foods can create a multinational culinary brand that includes multiple food categories. The journey ahead is going to be a giant leap for us, full of endless possibilities and definitely exhilarating!
