Tata Chemicals to shift food business to TGBL

Excerpt: Tata Group announced the transfer of its branded food business from Tata Chemicals Ltd (TCL) to Tata Global Beverages Ltd (TGBL) in an all-shares deal.

Tata Group announced the transfer of its branded food business from Tata Chemicals Ltd (TCL) to Tata Global Beverages Ltd (TGBL) in an all-shares deal.

The deal is expected to create a more than Rs 9,000-crore turnover giant. As per the deal, TGBL will buy the business of selling edible salt, spices and lentils and give shares in return to TCL. After the merger deal, TGBL will be known as Tata Consumer Products Ltd. The transaction is subject to statutory and regulatory approvals, including those of the National Company Law Tribunal (NCLT), stock exchanges, Securities and Exchange Board of India (SEBI) and shareholders.

The deal is a part of the business strategy initiated by Tata Group Chairman N Chandrasekaran to reduce the overlap between group companies and consolidate businesses sharing similar synergies and adjacencies within the conglomerate.

Commenting on the announcement, Chandrasekaran said, "Tata Consumer Products consolidates our current presence in food and beverages in the fast-growing consumer sector. Through this combination, we have created a strong growth platform to meet the growing aspirations of Indian consumers."

According to the company statement, the boards of directors of TGBL and TCL, at their meetings on Wednesday, approved the de-merger of the consumer products business of TCL into TGBL. "Each shareholder of TCL will get 1.14 new equity shares of TFBL for every one equity share held. The proposed transaction will create a focused consumer products company with a combined turnover of Rs 9,099 crore and an Ebitda of Rs 1,154 crore," it said.

AsianAge

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