Cadila buys stake in Carnation Foods

Set to acquire Nutralite, largest selling margarine.

Zydus Cadila has acquired 14.96% stake in Carnation Nutra-Analogue Foods Ltd for Rs 11 crore at Rs 145 a share. The company manufactures Nutralite, India's largest selling margarine currently enjoying a market share close to 60 per cent.

Nutralite margarine is a healthier substitute for butter. Nutralite tastes, feels and looks just like butter but free from cholesterol. Acquisition is expected to strengthen company's presence in the healthy dietary supplement segment.

Zydus Cadila has now made a public offer to acquire additional 20 per cent stake in Carnation Nutra-Analogue Foods Ltd to raise its holding. The acquisition includes the company's manufacturing plant.

The company also has a strong network of 350 distributors. A profit-making company, Carnation Nutra-Analogue Foods Ltd had posted a turnover of Rs. 30 crore in 2005-06. Nutralite will be marketed by Zydus Cadila's Consumer Products Division which currently markets India's largest selling sweetener brand Sugar Free.

Carnation Nutra-Analogue Foods Ltd., a Gujarat-based listed company, was set up in 1994 to manufacture and market dairy substitute or modified dairy health products like margarine, spreads, non-hydrogenated shortenings and speciality fats.

Pankaj R. Patel, Chairman and Managing Director, Zydus Cadila said: "Over the past few years, our focus has been on supporting healthy lifestyles and this forms an essential part of our healthcare business. We have market leadership in the sweetener segment through our brand Sugar Free and we see this acquisition as an excellent synergistic opportunity to offer a healthy dietary supplement."

A market leader in the low calorie sweetener market with a share of over 70 per cent, Sugar Free of Zydus Cadila has strengthened its presence with Sugar Free Dlite - a low calorie healthy drink which offers 85 per cent lesser calories than all sugar-based soft drinks and juices.

A new line extension, Sugar Free Natura - the sucralose based, versatile sweetener, made from sugar but without the calories, has also been launched in the market. With Nutralite in its fold, Zydus Cadila is expected to consolidate its positioning in the minds of the health and fitness conscious consumers.