Tata Consumer Products (TCPL) said on Friday that it has signed definitive agreements to acquire 100 per cent equity shares of Tata SmartFoodz Limited (TSFL) from Tata Industries Limited, for a cash consideration of Rs 395 crore. This move is consistent with TCPL’s strategic intent to expand into value added categories.
TSFL commenced operations in 2019 and within a short time has established itself as the number two player in the ready-to-eat (RTE) market in India. Under the brand name Tata Q, it offers a range of product offerings which currently includes pasta, noodles, biryani and combo meals.
Sunil D’Souza, managing director and CEO, Tata Consumer Products, said “ The acquisition will give us access to a unique technology and the product portfolio synergises well with our existing distribution infrastructure both in India and internationally.”
“We believe Tata Consumer Products is well positioned to help unlock the market potential of this technology and scale up this business to meet the growing consumer need for wholesome, trusted and convenient food offerings,” he added.
In India, the RTE category is expected to grow at a significant pace benefitting from demographic tailwinds such as urbanisation, and high disposable income nuclear families looking for convenience, nutrition and hygienic food on the go. The category is already large and growing strongly in the international markets that TCPL already operates in.
Tata Consumer Products will leverage its existing domestic and International distribution and focus on operational excellence to maximize value. The technology will also enable TCPL to create a strong pipeline of value-added products in other parts of the foods business.
Balark Banarjea, CEO, Tata SmartFoodz said, “Being part of Tata Consumer Products will enable us to strengthen our market presence and scale up the business. It will allow us to leverage Tata Consumer’s strength in modern trade and e-commerce channels in India and also its global presence to target key International markets for RTE exports. It will also help us augment our innovation pipeline and unlock synergies across our business.”