The company plans to acquire 75% of Capital Foods’ shares before March 31, with the remaining 25% to be acquired within three years. This acquisition will be carried out on a no-debt basis.
Capital Foods, known for its strong umbrella platform brands, offers a unique portfolio of products for in-home consumption in fast-growing categories. Its brand, Ching’s Secret, is a market leader in Desi Chinese products, including chutneys, blended masalas, sauces, and soups. Another brand, Smith & Jones, is rapidly growing and caters to in-home cooking of Italian and other Western cuisines.
In addition to Capital Foods, Tata Consumer’s board of directors has also approved the acquisition of Organic India. The company has entered into a share purchase agreement with Fabindia for an all-cash deal valued at Rs 1,900 crore, along with an additional earnout for the shareholders linked to the 2025-26 audited financials of the company.
The acquisitions align with Tata Consumer Products’ strategic intent of entering into new adjacent high-growth/attractive margin categories in the food and beverage space. The estimated turnover of Capital Foods for 2023-24 is between Rs 750 crore and Rs 770 crore, and its net worth was Rs 311.5 crore as of March 31, 2023. The estimated turnover of Organic India for 2023-24 is approximately Rs 360-370 crore.
Tata Consumer believes that the acquisition of Capital Foods will help expand its product portfolio and further strengthen its pantry platform. There are significant synergy benefits with the existing businesses of Tata Consumer Products in areas spanning distribution, logistics, exports, and overheads. The completion of this acquisition is contingent upon the fulfilment of various terms and conditions specified in the SPA and the shareholders’ agreement.
Organic India is one of the strongest organic brands spanning food & beverages and herbal & traditional supplements. The total addressable market for the categories that Organic India is present in is Rs 7,000 crore in India and Rs 75,000 crore in international markets where Tata Consumer has a strong presence.