Orkla, a leading supplier of branded consumer goods and concept solutions to the grocery sector, specialist retailers, out-of-home sectors and the bakery market, announced it has entered into an agreement to acquire 67.8 percent of the shares in Eastern Condiments Private Limited (Eastern).
Orkla already holds a strong position in the Indian branded food market with the well-known MTR brand which has grown its sales five-fold since it was acquired by Orkla in 2007. For the last 12 months ending 30 June 2020, MTR had a turnover of INR 9.2 billion.
With this transaction, Orkla will grow its position as one of the leading branded food players in India and have a platform for further growth in the spice category and in adjacent categories, the Company said in a press release.
As per the agreement, the merger will result in the union of two iconic Indian brands. The merged business will create a solid base for future growth in the Indian branded food market, driven by the positions of Eastern and MTR in spices and packaged food categories. With this transaction Orkla will establish a platform for further growth in India in several categories.
“This announcement marks a significant step for Orkla towards delivering on its strategy to strengthen our footprint in our core geographies. By joining forces, Eastern and MTR will create a solid platform in the fast-growing Indian market, based on strong local brands. MTR has been a great success story for Orkla. Now we look forward to continuing the journey with the Meeran brothers as partners”, says Orkla President & CEO Jaan Ivar Semlitsch.
“We are entering into this partnership at a special point in time for Orkla and for the rest of society. During the ongoing coronavirus crisis, our priorities have naturally revolved around taking care of our employees, preventing the spread of infection and supplying the food, cleaning products and hygiene articles that people need. At the same time, we have also been committed to positioning Orkla for the longer term. I have strong confidence in the long-term strength and resilience of the Eastern and MTR brands. Spices are an essential part of any Indian household, and I even believe we will emerge strengthened from this crisis,” adds Jaan Ivar Semlitsch.
“Eastern and MTR have a strong combined portfolio of complementary products, an attractive geographical presence and good export potential. The Indian branded food and spice markets are growing by double digits, and we see positive long-term demand dynamics with increasing purchasing power and more urban lifestyles. We are looking forward to this new partnership. This will definitely strengthen Orkla’s position in India,” says Sanjay Sharma, CEO of MTR.
“Orkla is known for its strong, local brands and holds leadership positions across multiple FMCG categories in several markets. Orkla has a solid track record of building leading food brands based on a strong organisational culture and company values. Together with MTR, and as part of Orkla, we will have a stronger platform for our successful operations,” says Navas Meeran, Chairman of Eastern.
Eastern offers a mix of non-vegetarian and vegetarian food products largely in the categories of blended and single spices. MTR has, and will continue to have, a purely vegetarian product range in spices and packaged foods. Together, the companies will have an even stronger offering to the Indian consumer.
Eastern has seven production facilities in four different states in India and employs around 2,955 people. Its headquarters are located in Edapally, Kochi.
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