Tata Global Beverages Ltd (TGBL) announced that it will acquire the branded tea business of Dhunseri Tea & Industries for an aggregate consideration of Rs 101 crore.
TGBL mentioned in a stock exchange notification, “The proposed acquisition shall be subject to due diligence, signing of definitive binding agreements and applicable shareholder, statutory/regulatory and other third-party approvals, as may be applicable.”
The Kolkata-based Dhunseri Tea and Industries has two brands — Lalghoda and Kalaghoda – which are among the leading local brands in Rajasthan, a market dominated by local players. The Tata Group Company said in the notification, “The proposed acquisition is in line with its ambition to grow its branded tea business in India.”
TGBL said that its India tea business clocked a 9 percent volume growth and 7% value growth across its brands. For the March quarter last fiscal, the tea business in the country registered a 12% volume growth and 11% value growth.
It also added, “Profit before exceptional items and tax at Rs 161 crore is higher by 24 percent compared with corresponding quarter of the previous year mainly due to higher sales, lower commodity cost in international markets and improved performance of non-branded business.”
“Tata Starbucks clocked a strong ~30% growth in revenues for the year. It added 30 new stores during the Year, taking the current store count to 146 stores across India. It recently opened its largest coffee forward store in Bengaluru, celebrating every aspect of the coffee journey through live coffee brewing experience,” it added.
As per the company, “This move is in line with TGBL’s ambition to grow its branded tea business in India.”
Presently, TGBL gets around 55 percent of its revenue from the Indian market, which is largely dominated by tea vertical. TGBL is a global beverage business and its brands have a presence in over 40 countries.