Indian company Prabhat Dairy has agreed the sale of its dairy business to Tirumala Mill Products Private Limited, a wholly-owned subsidiary of Groupe Lactalis, for INR 1,700 crore ($239m).
And another Lactalis subsidiary, HALAWA JV Group, has acquired 100% of the shares of Greenland Group for Food Industries in Egypt, which was previously owned by Americana Group.
Greenland, which was founded in Egypt in 1995 and was acquired by the Americana Group in 2005, owns eight factories in Egypt with a workforce of more than 2,000 people producing mainly cheeses. In addition, Greenland owns and operates the only whey production factory in the Middle East region.
Greenland’s annual production capacity exceeds 100,000 tons in dairy foods and juice products, and its products are sold in more than 50 countries globally.
According to documents filed to India’s stock exchange, the NSE, the transaction involves “sale of the dairy business undertaking of Prabhat Dairy by way of slump sale on a going concern basis, along with the sale of 100% shareholding in Sunfresh Agro Industries Private Limited (a step-down subsidiary of Prabhat Dairy Limited) via a share purchase agreement.”
Prabhat Dairy said the sale will allow it to further develop its cattle feed business in various parts of the country, as well as expand into businesses such as animal nutrition and animal genetics.
Vivek Nirmal, joint managing director of Prabhat Dairy, said, “We are pleased to announce this agreement with Lactalis. For the past 20 years, Prabhat has established itself as one of the most trusted dairy brands in the country, with strong supply partnership with over 100,000 farmers, two state-of-the-art manufacturing facilities. Cutting edge technology and stringent quality standards.
“The association with Lactalis – one of the world’s largest dairy players will offer this business a strong platform for accelerated growth momentum in becoming one of the largest private dairy businesses in India. I strongly believe that this partnership offers a promising future to our team members, partners and stakeholders.”
Raviraj Vahadane, chief financial officer of Prabhat Dairy, said, “The acquisition of the dairy business undertaking of Prabhat by Lactalis represents a meaningful opportunity for the employees of Prabhat to be associated with one of the global leaders in the dairy products business.”
Prabhat Dairy said it intends to share a substantial portion of the proceeds from the sale with shareholders after meeting its tax and transaction cost obligations.
In a further communication with the NSE, Dipti Todkar, company secretary, added that, “The proceeds being referred to herein, refers to all proceeds to be received as part of the Transaction by the Company as well as its subsidiaries, including those receivable by Cheese Land Agro (India) Private Limited, which is a 100% subsidiary of the Company.”