ITC Limited will acquire 100% stake in Sresta Natural Bioproducts Private Limited (SNBPL), a manufacturer of organic packaged food products under the ‘24 Mantra Organic’ brand, for a total consideration of Rs 472.50 crore, the Kolkata-headquartered FMCG major said in a press statement.
SNBPL’s portfolio comprises 100+ organic products including grocery staples, spices and condiments, edible oils, beverages, etc. It has a strong international presence with a deep connect with the Indian diaspora.
“SNBPL’s vertically integrated supply chain promotes sustainable livelihoods for its network of approx. 27,500 farmers spread across 1.4 lakh acres of certified organic land in 10 states. The strong network of farmers and certified organic sourcing capability are key sources of competitive advantage for the company,” ITC said in a statement. SNBL has been generating annual revenues of Rs 320 crore over the past three financial years.
According to ITC Ltd, the Indian organic market (domestic and exports) is currently estimated to be Rs. 10,000 crore in size. The category has high growth potential given the low penetration levels domestically as well as globally and the growing consumer preference towards natural and organic food products.
The organic foods space is an area of interest for ITC given the strong synergistic linkages to the Company’s branded packaged foods portfolio and the immense growth potential of the category, the company said adding that the acquisition reinforces ITC’s commitment to build a portfolio of future-facing winning brands that addresses the evolving needs of Indian consumers, and will unlock value creation opportunities by leveraging ITC’s institutional strengths to drive synergies in areas such as product development & innovations, sourcing, manufacturing, supply chain and distribution.
Meanwhile, ITC has signed definitive agreements to acquire the balance 73.5% stake in Mother Sparsh Baby Care Private Limited (Mother Sparsh), an associate company, operating in the premium ayurvedic and natural baby care space.
The acquisition will be made in two phases, with ITC raising its shareholding from 26.5% to 49.3% by investing Rs 81 crore. This transaction is likely to be completed by the first quarter of FY27. In the second phase, ITC will increase its shareholding to 100% by the first quarter of FY29.