INDIA – Reliance Consumer Products Limited (RCPL), a wholly-owned subsidiary of Reliance Retail Ventures Limited (RRVL) has taken a majority interest of 51% in Hyderabad-based local confectionery firm Lotus Chocolate Company (Lotus) for INR740m (US$8.9m).
As part of the share purchase agreement (SPA), RCPL proposes to acquire 77 percent of the paid-up share capital of Lotus Chocolate through a “secondary purchase” from promoters Prakash Peraje Pai and Ananth Peraje Pai, followed by an open offer.
As per the SPA, Prakash Peraje Pai and Ananth Peraje Pai proposed to sell equity shares of the company to RCPL. Both jointly own a 57% stake in Lotus Chocolate, as of the quarter that ended September 2022.
The two Reliance group firms – Reliance Consumer Products and Reliance Retail Ventures will undertake the acquisition of a 26% additional stake in Lotus during the open offer which starts on February 21 and closes on March 6.
The firms will together acquire 33.38 lakh shares of Lotus Chocolate from the open market at a fixed price of Rs 115.50 per share, said a notice by DAM Capital, which is managing the offer.
The offer will aggregate to a total consideration of Rs 38.56 crore over the full acceptance, said an open offer-detailed public statement shared by the company with stock exchanges.
The capital injection will “help drive the growth and expansion of Lotus into a comprehensive confectionery, cocoa, chocolate derivatives, and related products manufacturer,” according to an announcement by Reliance Industries to the National Stock Exchange of India.
Lotus is a manufacturer of chocolates, cocoa products, and cocoa derivatives diversified into consumer, gifting, and industrial chocolate products.
Its Industrial chocolate products include lotus cocoa mass, lotus cocoa powder, lotus cocoa butter, lotus chocolate, lotus choco treats, lotus plain choco paste, lotus ice cream coverings, lotus drinking chocolate powder, lotus chocolate sauce, and lotus chocolate decorative.
The company’s consumer chocolate products include chuckles, superr carr, on and on, kajoos, and tango, among others while also offering gift services on special occasions.
A few days ago, RCPL also acquired a 50% t stake in Gujarat-based carbonated soft drinks and juices maker Sosyo Hajoori Beverages Pvt Ltd.
Along with strengthening RCPL’s beverages portfolio, RRVL said the acquisition will the company to leverage Sosyo’s expertise in formulations to create unique value propositions for our product portfolio and consumers.
In September last year, the company said it was undertaking an expansion drive in the FMCG segment, having already started talks with several makers, which would be announced subsequently once the deals are finalized.