ITC to acquire '24 Mantra Organic' maker SNBPL for Rs 472.50 crore

The acquisition is expected to be completed in the first quarter of FY26

Diversified conglomerate ITC signed a share purchase agreement on Thursday to acquire 100 per cent share capital of Sresta Natural Bioproducts Private Limited (SNBPL), the company behind the ‘24 Mantra Organic’ brand, for Rs 472.50 crore.

 

The acquisition, expected to be completed in Q1 of FY26, entails an upfront consideration of Rs 400 crore on a cash-free, debt-free basis payable on closing, and an additional founders’ consideration of up to Rs 72.5 crore payable over two years.

 

The SNBPL portfolio comprises more than 100 organic products spanning branded grocery staples, spices and condiments, edible oils, beverages, among others. The company also has an international presence, connecting with the Indian diaspora.

   

In a statement, ITC mentioned that SNBPL’s vertically integrated supply chain promotes sustainable livelihoods for its network of approximately 27,500 farmers spread across approximately 1.4 lakh acres of certified organic land in 10 states.

 

The strong network of farmers and certified organic sourcing capability are key sources of competitive advantage for the company, it added.

 

Commenting on the acquisition, Hemant Malik, wholetime director, ITC, said 24 Mantra Organic has built a robust backend and sourcing network, which is core to its trusted organic products portfolio.

 

“Aligning with national priorities, we are confident that 24 Mantra Organic will fortify ITC’s presence and market standing in the high-growth organic products space, in both Indian and overseas markets,” he said.

 

Rajashekar Reddy Seelam, founder and managing director, SNBPL, stated, “After 21 years of partnering with Indian farmers to create trusted organic products, we are excited that ITC will be driving the next phase of growth for 24 Mantra Organic. ITC shares a common vision to promote sustainable livelihoods for farmers and ensure a healthy lifestyle for consumers.”

 

In FY24, SNBPL clocked a turnover of Rs 306.1 crore. About 50 per cent of its revenue comes from the US market.

 

According to the contours of the arrangement, Raj Seelam will assist in the transition and remain associated with the business for two years.

 

Mother Sparsh acquisition

 

ITC also executed a share subscription and share purchase agreement and shareholders’ agreement to acquire the balance 73.50 per cent of the share capital of Mother Sparsh, in one or more tranches over a period of two to three years.

 

ITC, which had first invested in Mother Sparsh in 2021, holds a 26.50 per cent stake currently.

 

ITC said it will be investing Rs 81 crore in two tranches through a combination of primary subscription and secondary share purchase by Q1 of FY27. After this, the company’s total investment in Mother Sparsh will stand at about Rs 126 crore, with the stake increasing from 26.5 per cent to 49.3 per cent. The balance equity stake would be purchased by Q1 of FY28 at a valuation based on pre-agreed criteria.