Corn Products Co (India) Ltd, the 74 per cent subsidiary of US-based Bestfoods, has acquired local instant mixes brand Tarla Dalal Foods (TDF), along with technical know-how, plant and machinery.
Corn Products thus expands its range from products like jelly, soup and custard to typically Indian food like idli, dosa mixes.
Salil Punoose, chairman and managing director, CPC said the company had hitherto been selling western foods, while a bigger market and potential lay in ethnic Indian food. "Tarla Dalal will help us sell products in the mainstream foods market, which the Indian housewife uses and wants," he explained.
Sold all over the country, Tarla Dalal was created by a Mumbai-based partnership firm and based on recipes created by cookbook writer Tarla Dalal. It makes over 18 types of instant mixes at its factory in Ambernath, outside Mumbai.
The deal between the two was signed yesterday morning in Mumbai. The price was not disclosed.
Corn Products had some days back proposed to acquire the Captain Cook brand of salt and the brand name from DCW Home Products. That acquisition is still subject to due diligence by Prime Securities, the investment bank that advised CPC.
The market for TDF-like products in India is not more than Rs 40 crore and CPC hopes to grab a 20 per cent market share over the next couple of years.
"We don't think we can create a big instant mixes brand overnight through Tarla Dalal. What we are getting here is access to an important category with a good and profitable brand," said Punoose. While Captain Cook, if it materialises, will chase volumes, Tarla Dalal will be a niche, profitable brand.
The acquisition will help CPC utilise its distribution network better. It now has 800 distributors and TDF is expected to bring in another 100. "It will help us spread our overheads much better," Punoose added.
Corn Products has been in India since 1931 but still remains a Rs 40 crore company. The company has traditionally focused on low-growth areas like custards jelly etc. In 1996, it signaled a change in strategy by launching its Knorr brand of soup, taking on Nestle's Maggie.
Punoose believes that current year's acquisitions will drive turnover by nearly 25 per cent this year.
