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Packaged food company Annapurna Swadisht Ltd on Wednesday announced that it has acquired the six-decade-old 'Arati' brand mustard oil from R R Proteins and Agro Ltd (RRPAL) for a consideration of Rs 28 crore.
The acquisition would help the company foray into the edible oil segment and strengthen its FMCG portfolio.
The estimated amount of Rs 28 crore includes the cost of acquisition of manufacturing unit and the brand, a company official said.
The funding for the deal would be a combination of internal accruals and debt, he said.
RRPAL has a production capacity of 9 lakh litres of oil per month, and the acquisition will enable Annapurna Swadisht to enter a new business vertical of edible oil, he said.
"We believe that acquisition offers an opportunity that aligns well with the company's overall strategy of becoming a formidable player in the packaged food industry in the semi-urban and rural markets of India," Annapurna Swadisht Ltd (ASL) Managing Director Shreeram Bagla said.
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The company aims at leveraging its existing distribution network in tier III, IV and V towns in eastern and northeastern markets to increase sales of 'Arati' brand mustard oil by offering low-priced consumer packs at Rs 10 and Rs 20, which have growing demand in these markets, he said.
ASL currently manufactures snacks and beverages, offering around 75 SKUs across 10 broad categories.
Its products are available at over 6 lakh retail touchpoints primarily in Bihar, Jharkhand, West Bengal, Assam, Odisha, and Uttar Pradesh.
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