Tobacco and fast moving consumer goods major ITC said it plans to acquire 100 percent in spices firm Sunrise Foods Private Limited for an undisclosed sum.
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ITC said it has signed a Share Purchase Agreement (SPA) with the promoters of Sunrise Foods and the deal will be completed "subject to fulfilment of various terms and conditions as specified in the SPA".
Sunrise is a market leader in eastern India in the spices category and is a 70-year old brand.
"The proposed acquisition is aligned with ITC’s strategy to rapidly scale up its FMCG businesses in a profitable manner," the ITC release said, adding that the proposed acquisition will augment its spices portfolio, help scale up its business and expand footprint across the country.
"ITC’s Aashirvaad range of spices is already a market leader in Telangana and Andhra Pradesh and the company is one of India's leading producers and exporters of high-quality food safe spices," the ITC release said.
Said an analyst on the proposed acquisition: "This is a positive development for ITC as, among its diversified portfolio, we are most excited by ITC's food business because of synergy with its agribusiness and a strong understanding of consumer taste due to its hotel business. Also it makes much more sense to buy a leader than creating a brand from scratch. Branded spices is an exciting and high growth segment as consumer shifts from unbranded to branded due to greater focus on safety, trust and quality."