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September, 2006 Pragati Maidan, New Delhi, India |
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Actis to buy Nutrine
Private equity major Actis is set to snap up India’s largest home-grown confectionery company — Nutrine Confectionery — for Rs 2750-3000m. An agreement has been reached and the transaction is likely to be concluded shortly.
This will constitute the first big-ticket acquisition by a private equity player in the FMCG sector. It will also be the largest deal in the FMCG space this year and its size will surpass Dabur’s Rs 1430m acquisition of Balsara.
At present, Nutrine is owned by the Reddy family.
The current management of Nutrine could continue to run the day-to-day operations of the company. The private equity company may also consider appointing a professional CEO at a slightly later stage.
Actis’ proposed acquisition of Nutrine will be yet another example of a private equity player buying out a company in India. This trend is catching on with ICICI Venture recently acquiring Ranbaxy’s allied business portfolio consisting of fine chemicals, diagnostics and animal healthcare businesses.
Earlier this year, ICICI Venture also bought over ACC’s refractory business and Actis itself had funded a management buyout of ICI’s nitrocellulose division last year.
Typically, private equity players exit a company in a few years after adding value to their investments. Industry sources expect Actis to follow a similar strategy.
Date: 24-Oct-2005
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