INDIA – Foods & Inn, an Indian-based fruits processor and frozen snacks manufacturer has acquired Kusum Spices based in Mumbai for US$1.97 million (Rs 13.99 crore).
Under the transaction, Foods & Inns will enter into partnership with a share of 99.99 per cent with Kusum Spices, the branded spice business under ‘Kusum Masala’ brand.
Announcing the partnership with Kusum Spice, Mr Bhupendra Dalal, Chairman, Foods and Inns Ltd, said, “As a part of our business strategy inorganic acquisitions are a key components of drivers of our growth.
“With Kusum Masala being a household name, this acquisition will lead our transition from being a purely B2B player to a branded B2C one in the branded spice business.
We aim to bring in synergy by expanding on Kusum’s distribution channels and private labelling will bring in growth both in revenues and margins and create value for all the shareholders.”
Foods & Inn said it will fund the acquisition through internal accruals. The company recently received US$20.85 million (Rs 148 crore) through sale of part of its assets in Mumbai, part of which it has used to pay its debt.
“We have used Rs 13.99 crore (US$1.97 million) and will use the rest for small ticket size acquisition in the frozen food category and also for expansion.
“With these acquisitions, we are expecting to double the revenue of our spice business and overall revenue to over Rs 400 crore,” Bhupendra added.
Kusum Spices had revenue of US$2.39 million (Rs 17 crore) in 2018-19, while Foods & Inn’s revenue stood at US$47.89 million (Rs 340 crore), out of which exports comprised 65% and 35% in the domestic market.
Kusum Spices, which is in the branded spice business under the brand name ‘Kusum Masala’ produces about 1100 MTs of spices and exports spices 25% of its produce. Kusum Spice has presence in domestic export market in Gulf and Africa.
In March this year, Foods & Inns acquired frozen foods company Finns Frozen, which produces frozen snacks such as samosa, onion bhajji, naans and vegetables.
Finns frozen division of Foods & Inns itself consumes about 100 Mt of Spices. This is likely to increase substantially in the coming year. A majority of their products are also exported.