TCPL to finance two acquisitions from internal accruals, short-term debt
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Tata Consumer Products (TCPL) will acquire Capital Foods Ltd and Organic India Ltd through its internal cash reserves and bridge financing (short-term loans). The collective enterprise value of these companies is Rs 7,000 crore. The company’s Managing Director and Chief Executive Officer (CEO) Sunil D’Souza gave this information on Sunday. He said both acquisitions are in sectors that offer huge growth opportunities. Margins in those areas are attractive and business is growing quite rapidly. Apart from this, TCPL will continue to strengthen its portfolio in the food and beverage segment, he said.
He said it would explore the possibility of acquiring other companies if someone offers a better brand, technology and team. Last Friday, TCPL had announced the complete acquisition of Capital Foods at an enterprise value of Rs 5,100 crore. It owns brands like Ching’s Secret and Smith & Jones. Apart from this, it had also announced the acquisition of Fab India backed Organic India.
Organic India, active in the health and care segment, has an enterprise value of Rs 1,900 crore. Tata Group’s FMCG arm will finance half of these two all-cash deals from internal accruals. “We have a fair amount of cash on hand, but obviously we will need a lot more to finance this,” D’Souza said. The board of directors of TCPL is scheduled to meet on January 19 to consider the proposal to raise funds by issuing commercial papers/debentures and equity.
Disclaimer: IndiaTheNews has not edited this news. This news has been published from PTI-language feed.
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