 "Malaysian partner to pick up stake in NHC Foods")
The promoters of spice and foodgrain exporter NHC Foods are in talks to sell their stake to the firm's Malaysian partner MAP Enterprises, the company said in a notice to the Bombay Stock Exchange.
"We wish to inform you that Malaysia based MAP Enterprises, leading importer of seed spices is in talks with NHC Foods Ltd, a two-star export house and manufacturer of spices under the brand SAAZ masala, in picking a stake in the company," the company said.
MAP Enterprises has been NHC's overseas partner for the past two decades and hence has opted to backward integrate to boost its import business and also to be part of India's growing spice industry through brand Saaz.
"Both companies have mutually decided to take this relationship to the next level," it added.
This comes close to the heels of NHC Foods announcing plans to raise funds through sale of its fully automated manufacturing unit in Pardi, stake sale as well as promoters' contribution in order to become a debt-free company over the next two years. The launching of brand Saaz, helped establish the brand in the market but has also resulted into heavy debt burdens for the company.
Further, the company, with cash inflow, intends to clear off debt burdens which will help increase profitability and also divert additional resources for its Saaz brand. The company plans to restructure its activities by consolidating its functioning from a centralized location which will increase productive efficiency and optimize operational costs, a company statement said.
NHC's focus over the past three years has changed from little diversion from its spices trading business which has low margins and concentrate on its branded business which brings in more than 30 per cent margins.
Further, the company with cash inflow, intends to clear off debt burdens which will help increase profitability and also divert additional resources for its Saaz brand. The company plans to restructure its activities by consolidating its functioning from a centralized location which will increase productive efficiency and optimize operational costs, whereby revenues and profitability would go up sharply.
NHC Foods engaged in the procurement and processing of whole and ground spices, animal feeds, oil seeds and foodgrains with exports to more than 60 countries and has more than 200 international distributors.
NHC's stake was gained one per cent on Wednesday at Rs 17.55 apiece.
