Tata Tea Set To Merge Tetley Operations

Tata Tea is set to merge the operations of Tetley with itself. The move would allow Tata Tea and Tetley to operate as a single company, said Homi Khusrokhan, managing director, Tata Tea.

"We are working on merging the operations of Tata Tea with Tetley, both in the domestic market as well as overseas market" he said. The companies would benefit mutually through synergistic operations.

Tata Tea would also draw on Tetley's expertise in blending, tasting and packaging. Tetley primarily blends, packs and distributes tea products, mainly in tea bags. Tetley's product portfolio covers not only tea bags but also instant teas, flavoured teas, green teas, decaffeinated teas and herbal teas.

Management of supply chain cost would benefit both the companies. The Tetley group has a strong market position in the US, Australia and Europe and is a market leader in the UK and Canada.

Tetley has five production centres--one in UK, two in the US, one in Australia and one in India and all these centres have latest technologies and facilities for tea packaging and Tetley's history of innovations include the original tea bag and the draw string bag.

Analysts said after a recent briefing by the company, as part of synergistic operations, training would be given to Tata Tea personnel in buying and blending tea, which would make it suitable for exporting to Tetley. Tata Tea is also toying with the idea of launching Tetley brands in India.

Tata Tea has already integrated its marketing network with that of Tata Coffee, a subsidiary of Tata Tea. The two companies now have one national marketing organisation and Tata Coffee's branding, sales and distribution is now vested with Tata Tea. Tata Coffee happens to be Asia's largest integrated coffee company.

The virtual integration of Tata Tea and Tetley would bring the company a step closer to operating as one beverage company. Tata Tea reported a decline of 19.59 per cent in net profit to Rs 100.21 crore for 2000-01 compared with Rs 124.63 crore last year.