US-based cereal maker Kellogg’s is looking to give a local flavour to its business in India. The company, which entered Indian market way back in 1994, is currently in talks with India’s sweets and snacks giant Haldiram’s for a stake, ET NOW reported.
“Kellogg is keen to diversify beyond its core breakfast cereal category and enter the ethnic snacks & sweets segment and has initiated talks to invest a ‘significant’ amount in the Delhi and Nagpur arms of Haldiram’s,” ET NOW quoted sources as saying.
Deutsche Bank is the advisor to Haldiram’s for the said transaction. The amount expected to be raised is around Rs 2,500 crore, the report said.
Haldiram’s is looking to grow its domestic operations along with improving the global business. The proposed deal would only include Haldiram’s packaged products business even as its restaurant business is excluded from the current discussions, the source said.
“As per our policy, we don’t comment on rumours or speculation regarding potential acquisitions, JVs or divestitures,” Kellogg’s India replied to an email query by the news channel.
Kellogg’s India business has been reportedly growing at double digits since last 7 years.
According to statistics portal Statista, India’s breakfast cereals market currently generates revenue of $1.16 billion which is expected to grow by 6.4% annually till 2021 to reach $1.31 billion mark.
Haldiram’s last week partnered with French bakery chain Brioche Doree as its master franchisee for India and invested Rs 4-5 crore in it, the company said in a statement.
Haldiram’s was also among the contenders, in December 2018, to bid for revival of Bengaluru-based troubled food and beverages brand Maiyas.
In November last year, the report of Kellogg’s looking to forge partnership with Haldiram’s to expand into ethnic snacks and sweets segment first surfaced.
The company was also reportedly looking to raise Rs 2,500 from private equity funds in June 2018, however the deal didn’t close.