World’s largest #dairy products maker Le Groupe #Lactalis of France to purchase Tirumala Milk Products

Share on twitter
Share on facebook
Share on linkedin
Share on whatsapp
Share on email

World’s largest dairy products maker Le Groupe Lactalis of France will purchase Tirumala Milk Products by buying out the stakes from four owners and a private equity investor Carlye Growth Capital fund for $275 m or Rs 1,750 crore, two people with direct knowledge of the development said. 
The deal gives the French company an entry in to the world largest diary market which produces 123 million tonnes of milk now and slated to grow to 190 mt by 2015. Family owned Lactalis, with annual sales of 15.7b Euros or Rs 1.33 lakh crore have signed an agreement last week and will make it public soon.
«We always wanted to build the largest dairy product company. I am sure Lactalis Group which is the largest company in the world will make the Tirumala the largest in India also.» said Danda Brahmanandam, Tirumala’s founder and managing director who along with his three partners owns 76% stake. Carlye owns rest 24%.
Lactalis, with its first acquisition, will seek to look at more such opportunities for growth across India to capture a larger share of the diary market which is growing at compounded annual growth rate of anywhere between 13% and 15% until fiscal 2019-20 from $10b (Rs 60,000 crore) now. The Indian diary market commands 20% of the global milk production.
«For Lactalis, this acquisition is the first step. We believe India is a great opportunities. We will expand in other parts of the country,» Lactalis spokesperson Michel NALET told ET.
Four farmers from Andhra Pradesh, who were partners in an automobile finance company, later built Tirumala with an initial capital of Rs 2.5 lakh to an yearly sales of Rs 1427 crore in fiscal ended March 2013, with a net profit of Rs 70 crore. 
«We could in our generation, as friends, promote nurture and develop the company as one of the leading players in the Indian dairy industry as we could gel well together,» said Bolla Bramha Naidu, one of the founder partners in an earlier interaction with ET.
»Now, the next generation of promoters’ families is not gelling that well together like us and they are not keen to continue in the dairy business.» «Four of us used to fill the milk in sachets and sell at four locations in Chennai those days,» Naidu said on building the company.
Rothschild advised Le Groupe Lectalis while Tirumala’s investment banker was Barclays.
Carlye, which invested $22 m in May 2010 valuing the company at $85m, made a three fold return with a net profit of $50m, a 225% return on its investment.
«Carlyle has always believe in supporting good companies and in helping them in improving systems and processes and governance to take it to the next level, this is something in which we are very good ,» Shankar Narayanan, MD Carlyle India ..

Mirá También

Así lo expresó Domingo Possetto, secretario de la seccional Rafaela, quien además, afirmó que a los productores «habitualmente los ignoran los gobiernos». Además, reconoció la labor de los empresarios de las firmas locales y aseguró que están «esperanzados» con la negociación entre SanCor y Adecoagro.

Te puede interesar

Notas
Relacionadas