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Godrej Agrovet Ltd (GAVL), a subsidiary of Godrej Industries Ltd, has acquired 25% of additional stake in Creamline Dairy Products Ltd, one of South India's largest dairy producers selling their products under the brand name "Creamline" at an investment of Rs 150 crore.
Before this acquisition, GAVL was holding 26% stake in this company. Following this deal, however, GAVL would be a majority shareholder in Creamline with 51% stake. Through this acquisition, GAVL has entered into dairy sector full- fledged.
Creamline is a prominent dairy company in South India with significant operations across Telangana, Andhra Pradesh, Tamilnadu, Karnataka and at Nagpur in Central India. The company has very strong farm linkages across the four southern states, which assures it quality milk supply around the year. The retail presence of the company is strengthened by its "Jersey" Brand of milk and its derivatives. The company also operates dedicated "Jersey" milk parlors across southern India.
To increase its geographical foot print and fuel its future growth, Creamline is in the process of intensifying its procurement operations in Telangana, Andhra Pradesh, Tamilnadu, Karnataka and Maharastra and has forayed to setup three processing facilities along with facilities for value added products. It expects to increase its focus on the "Value added products" and new geographies to drive its future growth.
"We have been shareholders of Creamline since the last 10 years and have seen the company build a highly successful dairy business during this time. As the company embarks on its ambitious future growth plan, we believe GAVL will be able to bring in significant value to the business by helping it develop successful brands and add more value added products to its current portfolio. The existing management of the company would continue to operate as usual," said Balram Yadav, Managing Director, GAVL.
Godrej Agrovet has close to 20% market share in the organized cattle feed market. Godrej Agrovet hopes to build an entire cattle feed to high quality milk/milk product value proposition post this acquisition. The company has product offerings across the entire life cycle of cows, thereby helping the overall productivity of the animal.
"GAVL is one of the largest animal feed company with significant cattle feed presence. As we expand our business, we think GAVL will add significant value to our business through their long association with Indian dairy farmers and knowledge on building long lasting brands," said K Bhaskar Reddy, Managing Director, Creamline Dairy
Creamline expects to close FY16 with more than INR 1000 crore in sales. Creamline envisages doubling its turnover in the coming 3 to 4 years.
