Race to acquire Haldiram Snacks: Temasek secures term sheet, leads bid

Temasek has emerged as the leading contender to acquire a minority stake in Haldiram Snacks, after signing a term sheet with the promoters, with a valuation between $10 billion-$11 billion

After over 18 months of extensive negotiations, Temasek, a global investment firm based in Singapore, has emerged as the leading contender to acquire a minority stake in Haldiram Snacks Foods Private Ltd, according to a report by Moneycontrol.

 

This marks a significant development in the ongoing process, where the Delhi and Nagpur families of the Indian multinational snacks company are involved. Following the submission of binding bids, a term sheet has been finalised between Temasek and the promoters of Haldiram Snacks, the report said.

 

A term sheet outlines the main terms of an investment deal and serves as the foundation for a more detailed, binding agreement later.

 

 

The report quoted a source as saying that this is a pre-IPO deal expected to set a valuation benchmark, with Temasek aiming for a stake of less than 10 per cent in Haldiram Snacks at a valuation of $10 billion to $11 billion.

 

Despite the slow pace of the deal, significant progress has been made since late December, and there is optimism that it will be concluded successfully. If the promoters are agreeable, there could be an opportunity to sell an additional stake in Haldiram Snacks to other private equity investors. However, it remains uncertain whether this will happen, the report said, citing a source.

 

Earlier reports suggested that Haldiram might consider selling up to 20 per cent of its stake to unlock value. Competing bidders in the final stages of the deal include Blackstone and Alpha Wave Global.

 

Initially, discussions with several bidders focused on the potential sale of a controlling stake in Haldiram Snacks, but the negotiations later shifted toward a minority stake sale. With a valuation between $10 billion and $11 billion, Haldiram Snacks would be valued between Rs 85,700 crore and Rs 94,270 crore.

 

Earlier, a demerger of the FMCG businesses of Haldiram Snacks Private Ltd (HSPL, representing the Haldiram Delhi group) and Haldiram Foods International Pvt Ltd (HFIPL, representing the Haldiram Nagpur group) led to the creation of Haldiram Snacks Foods Private Ltd (HSFPL), with existing shareholders of HSPL and HFIPL holding 56 per cent, and 44 per cent stakes, respectively.

IPO on the horizon

The Agarwal family, the original founders of Haldiram, is considering the option of a public listing following the sale, with expectations of reaching a valuation of Rs 93,500 crore ($11 billion) through an IPO. Private equity bidders also see the potential IPO within the next 12 to 24 months as a crucial strategy for monetising their investments.