TGBL to acquire Dhunseri's branded tea business
Tuesday - April 23, 2019 11:08 pm , Category : BUSINESS
Kolkata, April 23 (IANS) Tata Global Beverages Ltd (TGBL) on Tuesday said it has entered into a non-binding term sheet to acquire the branded tea business of Dhunseri Tea & Industries Limited for an aggregate consideration of up to Rs 101 crore.The proposed acquisition will be subject to due diligence, signing of definitive binding agreements and applicable shareholder, statutory/ regulatory and other third-party approvals, as may be applicable, the company said in a regulatory filing.This move is in line with TGBL's ambition to grow its branded tea business in India, it added.Dhunseri's branded tea business currently has "Lalghoda" and "Kalaghoda" brands, which are among the leading local brands in Rajasthan, a market dominated by local players.Asked about non-binding agreement, Dhunseri's Managing Director C K Dhanuka told IANS: "We are looking to exit from the branded tea business. We are focusing to concentrate more on plantation and growing more tea."The company which produces close to 21 million kgs of tea through its estates spread in India and Africa, is looking for acquisition in Africa, he said.AAMeanwhile, TGBL on Tuesday said during the last financial year its India tea business clocked a 9 per cent volume growth and 7 per cent value growth across its brands. For the March quarter last fiscal, tea business in the country registered a 12 per cent volume growth and 11 per cent value growth.The company reported a 49.71 per cent year-on-year (y-o-y) fall in its consolidated net profit at Rs 35.99 crore for the March quarter of the last financial year. It had posted a profit of Rs 71.56 crore in the corresponding quarter of financial year 2017-18.For the quarter ended March 31, 2019, the company's consolidated revenue from operations grew nearly 5.16 per cent y-o-y to Rs 1,775.46 crore as compared to Rs 1,688.40 crore for the same period last year, according to a separate stock exchange filing."Profit before exceptional items and tax at Rs 161 crore is higher by 24 per cent as compared to corresponding quarter of the previous year mainly due to higher sales, lower commodity cost in international markets and improved performance of non-branded business," it said.On international operations it said, for the quarter UK business delivered a revenue growth of 4 per cent in underlying terms, led by a volume growth of 7 per cent. For the full year it registered a volume and value growth of 2 per cent and 1 per cent, respectively.A"Tata Starbucks clocked a strong 30 per cent growth in revenues for the Year. It added 30 new stores during the Year, taking the current store count to 146 stores across India," it added.
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