The company aims to strengthen its position in the organic and personal care segments through these acquisitions
Aiming to expand its footprint in the organic and personal care segments, ITC will be fully acquiring two companies- Sresta Natural Bioproducts or SNBPL, known for its brand 24 Mantra Organic and the remaining stake in its associate company, Mother Sparsh Baby Care.
The company informed in an exchange filing that it has signed a Share Purchase Agreement (SPA) to acquire 100 per cent of the share capital of SNBPL, an Indian company primarily engaged in the business of manufacture and sale of organic packaged food products under the ‘24 Mantra Organic’ brand in the domestic as well as in international markets.
The acquisition is valued at up to Rs 472.5 crore on a cash-free, debt-free basis. This includes Rs 400 crore payable at closing and up to Rs 72.5 crore over the following two years, based on pre-agreed terms. The transaction is expected to be completed in the first quarter of FY 2025-26.
“We are excited to have 24 Mantra Organic as part of ITC’s Foods Business’s portfolio of nutrition-led healthy foods products. 24 Mantra Organic has built a robust backend and sourcing network which is core to its trusted organic products portfolio,” stated Hemant Malik, Wholetime Director, ITC.
The Indian organic market (domestic and exports) is currently estimated to be Rs. 10,000 crore in size. SNBPL’s vertically integrated supply chain promotes sustainable livelihoods for its network of approximately. 27,500 farmers spread across approximately. 1.4 lakh acres of certified organic land in 10 states, as per the official statement.
“After 21 years of partnering with Indian farmers to create trusted organic products, we are excited that ITC will be driving the next phase of growth for 24 Mantra Organic. ITC shares a common vision to promote sustainable livelihoods for farmers and ensure healthy lifestyle for consumers,” highlighted Rajashekar Reddy Seelam, Founder and Managing Director, SNBPL.
Simultaneously, ITC also signed transaction documents to increase its stake in Mother Sparsh, an associate company, operating in the premium ayurvedic and natural baby care space, from 26.5 per cent to 100 per cent over the next two to three years.
The company will first raise its shareholding to 49.3 per cent through an investment of approximately Rs 81 crore in two tranches by Q1FY27. The final acquisition of the remaining stake will be completed by Q1FY28, with the possibility of extending to Q1FY29 based on mutually agreed terms.
“We are delighted that ITC has found value in Mother Sparsh, coming forward as an early investor, well poised to leverage the growth potential in the baby care space…ITC is the largest incubator of FMCG brands in India and know how to build and scale brands. We are confident that ITC will take Mother Sparsh to the next level and help serve the needs of mothers for generations to come,” highlighted Himanshu, Founder and Chief Executive Officer (CEO), Mother Sparsh.
As far as the management is concerned, ITC informed that the Mother Sparsh team, including Himanshu, will continue to operate the business during the two to three-year period and ITC will be represented on the Board.
