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Tata Consumer Products Limited (TCPL) has signed definitive agreements to acquire 100 per cent equity shares of Tata SmartFoodz Limited (TSFL) from Tata Industries Limited, for a cash consideration of ₹395 crore
“TSFL commenced operations in 2019 and within a short time has established itself as the #2 player in the ready-to-eat (RTE) market in India. It has a manufacturing facility in Sri City, Andhra Pradesh,” a press release said.
TSFL, under the brand name Tata Q, offers a range of products manufactured using MATS technology in India. Its product offerings include pasta, noodles, biryani and combo meals.
According to a press release, the acquisition will enable TCPL to expand its product portfolio and enter the RTE segment. In India, the category is expected to grow at a significant pace benefiting from demographic tailwinds such as urbanisation, and high disposable income, nuclear families looking for convenience, nutrition and hygienic food on the go. “The category is already large and growing strongly in the international markets that TCPL already operates in. Tata Consumer Products will leverage its existing domestic and International distribution and focus on operational excellence to maximize value. The technology will also enable TCPL to create a strong pipeline of value-added products in other parts of the foods business,” the press release said.
Sunil D’Souza, MD & CEO, Tata Consumer Products said “Tata SmartFoodz is a good strategic fit for us given the nature of its business and it will also allow us to expand our portfolio into the Ready to Eat segment. RTE is a fast-growing segment in India and a sizeable opportunity in the International markets. The acquisition will give us access to a unique technology and the product portfolio synergizes well with our existing distribution infrastructure both in India and internationally. We believe Tata Consumer Products is well positioned to help unlock the market potential of this technology and scale up this business to meet the growing consumer need for wholesome, trusted and convenient food offerings.”
Balark Banarjea, CEO, Tata SmartFoodz said, “Being part of Tata Consumer Products will enable us to strengthen our market presence and scale up the business. It will allow us to leverage Tata Consumer’s strength in modern trade and e-commerce channels in India and also its global presence to target key International markets for RTE exports. It will also help us augment our innovation pipeline and unlock synergies across our business.”
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