KOCHI: Eastern Condiments Pvt Ltd (Eastern), the makers Kerala's oldest branded curry powders and masala blends, controlled by the Kochi-based Meeran family, is being taken over by Oslo, Norway-headquartered Orkla Foods.
Orkla Foods on Friday said it has entered into an agreement to acquire 67.8 per cent of the shares in Eastern, which will see the Meeran family get roughly about Rs 1500 crore in cash and stocks.
Meeran family owned 74 per cent in Eastern while the remaining 26 per cent is owned by McCormick Ingredients, a US food company. As per the deal, Orkla, through its wholly-owned subsidiary MTR Foods Pvt Ltd, has signed agreements to purchase a 41.8 per cent ownership from the members of the Meeran family. MTR Foods will also acquire the entire ownership stake held by McCormick in Eastern, a statement said here.
A quick calculation showed the Eastern family will get Rs 836 crore in cash and Rs 633 crore worth MTR's shares.
After the transaction, MTR Foods will own 67.8 per cent stake in Eastern while the Meeran family owns 32.2 per cent. Following the completion of the transaction, MTR Foods will be merged with Eastern. While Orkla will own 90.01 per cent in the merged entity, brothers Firoz and Navas Meeran will own a small 9.99 per cent stake, the statement said.
"The parties have agreed on a purchase price that values Eastern (100 per cent) at Rs 2,000 crore on a debt and cash-free basis," the release said. "The merger will result in the union of
two iconic Indian brands."
The sale of Eastern is the biggest transaction involving a traditional Kerala business house after the 60-year-old Chandrika soap brand was bought by Wipro Consumer Care in 2003 from Irinjalakuda-based SV Products, founded by Kesavan Vaidyar.
"Together with MTR, and as part of Orkla, we will have a stronger platform for our successful operations," said Navas Meeran, chairman of Eastern.
MTR was established in 1924 and has been a part of Orkla since 2007. Eastern, established in 1983 with headquarters in Kochi by M E Meeran, has been growing at 8 per cent annually in the period 2014-2020. The company employs 2955 people.
| Companies | Buyer | Year |
| Chandrika soap | Wipro Consumer | 2003 |
| Tandem (Thiruvananthapuram) | Manipal K12 | 2009 |
| Profoundis (Kochi) | Full Contact (US) | 2016 |
| Eastern | Orkla Foods | 2020 |