This acquisition will enable Tata Consumer Products to expand its product portfolio and further strengthen its pantry platform
Tata Consumer Products announced that it has signed definitive agreements to acquire 100 per cent equity shares of Capital Foods, owner of the brands ‘Ching’s Secret’ and ‘Smith & Jones’, in a phased manner. 75 per cent of the equity shareholding will be acquired upfront and the balance 25 per cent shareholding will be acquired within the next three years. This move is consistent with Tata Consumer’s strategic intent to expand its product portfolio and its target addressable market in fast-growing/high-margin categories. Capital Foods has strong umbrella platform brands with a portfolio of unique products for in-home consumption in fast-growing categories. Ching’s Secret is a market leader in Desi Chinese across its product categories – Chutneys, Blended Masalas, Sauces and Soups. Smith & Jones is a fast-growing brand catering to in-home cooking of Italian and other Western cuisines. Overall, Capital Foods has #1 or #2 positions in five large categories.
This acquisition will enable Tata Consumer Products to 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 overall size of the categories in which Capital Foods operates is estimated at Rs 21,400 crores. Structural growth drivers for the category include continued growth in income levels, evolving consumer preferences leading to increased salience of global cuisines in in-home cooking and increasing need for convenience.