Kolkata-based multinational conglomerate company, ITC Limited recently announced that it is set to acquire spice maker Sunrise Foods Pvt Ltd in a Share Purchase Agreement (SPA). The move is expected to help the company strengthen its position in India’s fast-moving consumer goods (FMCG) market.
According to an official press release, ITC entered into a share purchase agreement on 23 May 2020 to acquire 100% of the equity share capital of SFPL, a company primarily engaged in the business of spices under the trademark ‘Sunrise’.
“The proposed acquisition is aligned with ITC’s strategy to rapidly scale up its FMCG Businesses in a profitable manner, leveraging its institutional strengths viz. deep consumer insight, a deep and wide distribution network, agri-commodity sourcing expertise, cuisine knowledge, strong rural linkages and packaging know-how,” read a company statement.
The move will help ITC expand its FMCG business, which at present spans packaged foods to personal care products.
The acquisition will also help ITC ramp up its spices business in the country. ITC already sells spices under its Aashirvaad brand, popular in markets such as Telangana and Andhra Pradesh. ITC is also one of India’s leading producers and exporters of high-quality food safe spices.
“The proposed acquisition will augment the company’s product portfolio and is aligned to ITC’s aspiration to significantly scale up its spices business and expand its footprint across the country. The deep consumer connect and distribution strength of SFPL in the focus markets, together with synergies arising out of the sourcing and supply chain capabilities of the company’s agri business and its pan-India distribution network, will provide significant value creation opportunities for the company,” ITC said.
The proposed transaction is also in line with ITC’s philosophy of enhancing the competitiveness of Agri value chains in India whilst making a meaningful contribution to enhancing farmer incomes, said the company.
Highlighting the company’s efficiency during the lockdown, ITC said, “Finalisation of the SPA along with related processes were completed during lockdown conditions, reflecting the Company’s agility and resilience in dealing with the new normal.”
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