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ITC completes acquisition of spice-maker Sunrise in Rs 2,150-cr all-cash deal

IBEF:  July 29, 2020

ITC Ltd, a diversified conglomerate, completed the acquisition of spice-manufacturer Sunrise Foods Private Ltd at an upfront cash deal price of Rs 2,150 crore (US$ 305.01 million). The deal was a “cash-free, debt-free” basis.

ITC’s stock market notification said that the acquisition was completed on July 27 with 100 per cent of the equity share capital being acquired.

It further added, “In addition, the sellers are entitled to contingent consideration of an amount not exceeding Rs 150 crore (US$ 21.28 million), which is payable upon Sunrise achieving mutually agreed operational and financial milestones over a period of two years”.

Sunrise Foods is based-out of Kolkata and reported a turnover of Rs 591 crore (US$ 83.84 million) in FY20 and has a net worth of RS 242.89 crore (US$ 34.46 million), is a 70-year-old brand. Company has a strong presence in the eastern and north-eastern parts of the country. With this acquisition, ITC will be able to ramp up its existing spices portfolio under the Aashirvaad brand. Aashirvaad’s select portfolio of spices has a strong presence in Andhra Pradesh and Telangana. The acquisition was announced by ITC in May this year.

After this acquisition, Sunrise, and its two subsidiaries ― Sunrise Sheetgrah Private Limited and Hobbits International Foods Private Limited ― have become wholly owned subsidiaries of ITC, it added in the stock market notification.

ITC has been focussing on the non-cigarette FMCG business over the past few years.

It has acquired brands such as Savlon, Shower to Shower and Charmis in the personal care space; Nimyle in the home care segment; and B Natural juices in the foods segment.

FMCG-Others segment contributes as the second-largest segment in terms of revenue of the company, ahead of hotels, agri-business, and paper and packaging.

Under this segment, the company has portfolio in segments such as foods, personal care, stationery, matches and incense sticks. The Sunrise Foods buyout complements ITC’s food portfolio, which consists of brands such as Aashirwaad, Sunfest, Bingo!, YiPPe!, B Natural and Fabelle, say market sources.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.