LT Foods share price surged over 16 per cent on Friday after Hindustan Unilever (HUL) signed an agreement with the company for sale of its rice exports business for a consideration of Rs 25 crore as it looks to exit non-core businesses.
At 12.06 pm, LT Foods share price was trading 7.92 per cent up at Rs 241.10. The scrip opened at Rs 235.10 and has touched a high and low of Rs 259.80 and Rs 235.10, respectively, in trade so far. Later, the share price settled the day 6.04 per cent up at Rs 236.90
“…it (HUL) has signed an agreement for the sale of its rice exports business carried out primarily under the brands ‘Gold Seal Indus Valley’ and ‘Rozana’, to LT Foods Middle East DMCC, a group company of LT Foods Limited (owner of ‘Daawat’),” the company said in a filing to the BSE.
HUL said the deal envisages transfer of the brands and inventory for a consideration of Rs 25 crore, subject to adjustments on closing.
“HUL’s decision to divest is in line with its strategy to exit non-core businesses, while continuing to drive its growth agenda in the core packaged foods business,” it added.
The transaction is subject to fulfillment of certain conditions and the parties will work together to complete this over the next few months. HUL will continue to manage the business until the completion of the transaction.
HUL began exporting premium Basmati rice in 1985 under the brand ‘Gold Seal Indus Valley’ to various countries in the Middle East and Europe, which was subsequently extended to other brands and geographies.