Marico sells unit to Denmark’s Good Food

Consumer goods firm Marico Ltd said late on Tuesday it has sold its processed foods business under the ‘Sil´ brand to Denmark’s Good Food Group for an undisclosed sum to focus on its cosmetic business.
The sale to Good Food’s Indian unit, Scandic Food India Pvt Ltd, includes a manufacturing unit near Pune.Marico will distribute the Sil range of products for one year, according to an official statement issued by the company.Marico owns India’s top coconut hair oil brand Parachute and has acquired hair care brands in South Africa and Egypt.

ITC acquiring Parle's unit-Sources

It is speculated that ITC Foods is in an advanced stage of discussions with Parle for acquiring the latter's confectionery arm. However, when contacted, both ITC divisional chief executive (foods) Ravi Naware and Parle chairman Ramesh Chauhan denied that a deal is brewing.

"We do not comment on market speculation," Naware said, while pointing out that the company is continuously on the lookout for acquisitions in the foods business."If we get a good opportunity, we will buy." Chauhan said he has not been approached by anybody, including ITC. "Even if there is a proposal, I will not sell," Chauhan said.

ITC has been looking for buyouts in the foods space for the last couple of months. Since ITC entered the foods business in 2001, it has only acquired one brand, 'Mint-O', which is one of the leaders in its segment.

The foods business accounts for a major portion of the over Rs 1,800 crore revenue of ITC's new FMCG businesses. Its brands include 'Kitchens of India', 'Sunfeast', 'Candyman', 'Bingo' and 'Aashirvaad'.

Read more in The Times of India article.

HUL rejects Temptation bid for marine biz

Consumer goods major Hindustan Unilever (HUL) announced that it has terminated the bid made by Mumbai-based Temptation Foods (TFL) to acquire HUL’s marine foods business.

Temptation had submitted a binding bid in May 2007, after HUL obtained shareholder approval in March this year to transfer its marine foods export business.

This was subsequent to the decision by HUL’s parent, Unilever, to exit from frozen foods, barring ice-cream, globally.

“The talks with Temptation Foods did not have a successful outcome. Consequently the binding bid submitted by TFL was terminated in August 2007,” HUL said in a statement.

The announcement comes at a time when TFL’s Qualified Institutional Placement (QIP) to raise Rs 114 crore to fund acquisitions went live. Last week, the company also received shareholder approval to raise more than Rs 90 crore through a preferential allotment.

Read more in The Business Standard article.

Dabur to merge foods biz with FMCG

Homegrown FMCG major Dabur India Limited (DIL) on Wednesday said it will merge its wholly-owned subsidiary Dabur Foods Limited (DFL) with itself.The Board of Directors of DIL approved the merger with retrospective effect from April 1, a company statement said.

"We believe this merger is a unique opportunity to combine the strengths of a foods company with those of a growing and profitable FMCG business to create an extraordinarily strong and rapidly growing global competitor in the health and wellness space," Dabur India CEO Sunil Duggal said.

He said DFL is an intrinsic part of DIL's growth strategy and has been one of the fastest growing businesses, reporting a 35 per cent CAGR for the past five years.Through the merger, DIL is looking to extract synergies and unlock operational efficiencies for DFL sharpen focus on the high growth business of foods and beverages, and enter newer product categories in this space, it added.

Emami set for cosmetic changes

Emami Group on Wednesday said it will invest about Rs 220 crore for expansion in the FMCG segment, which includes acquisitions in personal care and healthcare space and product portfolio enhancement through forays into new categories.

The company, which is eyeing over Rs 500 crore of revenue in the next 3-4 years by foraying into new segments like babycare, haircare and expansion in men's grooming categories, has also renewed its advertising contract with Bollywood superstar Amitabh Bachchan for another three years.

On product portfolio expansion, Agarwal said Emami would launch 18 new products this year in hair care, baby care and men's grooming segments.He said the company invests Rs 120 crore on brand investments every year, out of which Rs 40 crore would be spent on the new launches.

Read more in The Economic Times article.

Stock market seems to be rain-proof now

Essentially an agrarian country, India is at the mercy of the monsoon. Any variation in the seasonal rains can lead to floods or droughts and play havoc with the country’s economy.

Hence, it came as no surprise when the stock market reacted positively to the Indian Meteorological Department’s (IMD) prediction of normal rainfall for the year. As per IMD’s long-range forecast for 2007, the south-west monsoon is likely to account for 95% of the total rainfall, give or take a 5% error.

Market players vouched on sectors like construction, FMCG and automobiles to benefit the most from a normal and timely rainfall. Many even felt that normal rainfall would boost exports from the country.

While most analysts agree that a drought in the ‘wheat belt’ or a flood in the ‘sugar belt’ has a strong bearing on the industry it caters to, the effect is rarely reflected on equity markets. One reason for this could be that Indian markets are more correlated to sectors (or industries) that are not really dependent on rainfall. IT, banking, petroleum and pharma companies form a major portion of the equities market.