Zydus to buy Heinz India biz
New Delhi, October 24
Consumer products firm Zydus Wellness on Wednesday announced the acquisition of India business of Complan-maker Kraft Heinz Co for Rs 4,595 crore in a bid to expand product portfolio in the world’s fastest growing economy.
Zydus and Cadila Healthcare will gain the control of instant-energy drink Glucon-D, talcum power brand Nycil and ghee brand Sampriti from the acquisition of Heinz India, the companies said in regulatory filings.
Tata Group and consumer goods manufacturer Dabur India were reported to be among the suitors for the Kraft Heinz’s India businesses. Rival Glaxo’s health drink Horlicks is also said to be up for sale, for which Nestle, Unilever and Coca-Cola are reported to be among the bidders.
Ahmedabad-based Zydus will get global rights for Glucon-D, Nycil and Sampriti Ghee and will acquire rights for India, Bangladesh, Nepal and countries where the seller has intellectual property rights for Complan.
Revenues from Complan, Glucon-D, Nycil and Sampriti Ghee were about Rs 1,150 crore in 12 months ended June 30. The deal will push annual revenue of Zydus Wellness to Rs 1,700 crore.
The valuation for Heinz India includes net working capital of Rs 40 crore and cash of Rs 15 crore but does not assume any debt, Zydus said in a statement adding the acquisition is expected to be completed in the fourth quarter of the current fiscal year. A mix of debt and equity would be used to fund the transaction and “select leading private equity firms have committed to partnering the transaction by way of equity support,” it said.
Zydus Wellness chairman Sharvil Patel said: “This development offers immense opportunity to broaden our portfolio and invest in brands and products that we believe are most relevant to health-conscious consumers.” It leverages the group heritage, innovation track record, combined brand offerings and capabilities to meet and exceed its consumers’ evolving health and wellness needs, he added. “This acquisition will be an ideal addition to Zydus Wellness, supporting our aspirations to grow in the consumer wellness space.”
When asked whether Zydus would also bid for Horlicks, which is believed to be on the shelves from its promoter, Patel said: “No. For the time and strategic rationale, this brand (Complan) makes more sense for us.”
Kraft Heinz started operations in India in 1994 and has two facilities in Aligarh in UP and Sitarganj in Uttarakhand. The manufacturing units are part of the deal. Kraft Heinz said it will continue to grow its Heinz sauces and other Kraft businesses in India. — PTI
Boost to Zydus Wellness
- The Rs 4,595-crore deal will push annual revenue of Zydus Wellness to Rs 1,700 crore
- Ahmedabad-based Zydus will get global rights for Glucon-D, Nycil and Sampriti Ghee
- It will acquire intellectual property rights for Complan in India, Bangladesh and Nepal
