Tata Consumer Products acquires Soulfull brand owner, Kottaram Agro Foods for Rs 155.80 core

Tata Consumer Products Limited (TCPL) has signed definitive agreements to acquire a 100 per cent stake in Kottaram Agro Foods (KAF), owner of the brand 'Soulfull’. The transaction is expected to be completed by Q4FY21.

The cost of acquisition decided is Rs 155.80 crore. In addition, the promoters are entitled to a contingent consideration, which is payable upon the business achieving certain operational and financial milestones over a period of 5 years.

Through this acquisition, TPCL will get an opportunity to expand its portfolio in the fast-growing ‘on the table’ and ‘on the go’ categories. There are also significant synergies possible with the existing business of TCPL in areas spanning distribution, procurement & logistics. In addition to this, the name of ‘Tata’ would further enhance the brand’s credentials with consumers.  

Meanwhile, the brand 'Soulfull’ was launched in 2013. It operates in the health & wellness focussed food segment with a portfolio of millet-based products for kids and adults. It is one of the fastest-growing brands in India's 'better for you' packaged foods market. The brand has an innovative portfolio of products such as cereals, healthy snacks, muesli, and plant-based protein drinks. The brand currently has a strong presence in select urban markets in South, West & North India with a reach of 15,000 outlets. 

On the financial front, TCPL’s consolidated revenue for the quarter Q3FY21 came in at Rs 3,069.56 crore as against Rs 2,492.96 crore in the corresponding quarter last year, registering a 23.1 per cent YoY increase. EBITDA for the quarter grew by 13.6 per cent YoY to Rs 361.33 crore while the EBITDA margin for the quarter stood at 11.8 per cent. PAT for the quarter came in at Rs 237.03 crore as against Rs 189.23 crore in the corresponding quarter last year, with a YoY increase of 25.3 per cent. 

During Wednesday’s morning session, the stock of TCPL was trading 3.9 per cent at Rs 597.90 from its previous close of Rs 575.55 on BSE.