Business Today

BT Retro

     Print Edition: Nov 13, 2011

July 29, 2007
If Nusli Wadia was looking for a new partner for Britannia Industries, he didn't have to wait too long - and didn't have to do too much. His current joint venture ally, Groupe Danone of France, is in dialogue with Kraft Foods of the US to sell its biscuits and cereal products portfolio that includes brands like LU, Cracotte and Petit Dejéuner. This will be for the sale of Danone's biscuits and cereal products business across the world except India and Latin America. The French foods giant and the Wadia group each own a 25.1 per cent stake in Britannia. Both the partners have had an uneasy relationship for a while now. Globally, Danone's biscuits and cereal products business registered sales of Euro 2 billion against the company's total revenues of over Euro 14 billion. At an offer price of Euro 5.3 billion, Kraft will be paying a large premium for Danone's biscuits and cereal products business.

If Kraft doesn't buy out Danone's stake in Britannia, the French corporation may decide to sell it to the Wadias. At Britannia's current market capitalisation of around Rs 4,100 crore, Danone's 25.1 per cent holding is worth over Rs 1,000 crore.

Now: After its bitter break-up with the Wadia group in 2009, Groupe Danone has kickstarted its Euro 600-million bottom-of-the pyramid business by launching a milk-based fortified dessert called Fundooz in India.  However, about 70 per cent of Danone's business in India comes from packaged curds.

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