India Development News & Foreign Investment Opportunities

Kraft Heinz to Sell Indian Brands Zydus

Heinz sauces to grow in Indian market


Heinz sauces to grow in Indian market



The Kraft Heinz Company is to sell Indian brands Complan, Glucon-D, Nycil and Sampriti to Zydus Cadila at a valuation of approximately Rs.46 billion (approximately US$625 million) on a debt free and cash free basis.

A definitive agreement was announced on 24 Oct 2018. The transaction is expected to close in early 2019, subject to regulatory approvals of the Competition Commission of India and other customary closing conditions.

“The sale of this niche business fits into our overall global growth strategy and our focus on investing in and growing brands within our core categories,” said Bernardo Hees, Chief Executive Officer of Kraft Heinz.

“India continues to be a key market for Kraft Heinz, and in fact, we’re strengthening our commitment to expand and grow our Heinz sauces and Kraft business in India,” Hees said.

At current FX rates, this business generates approximately US$150 million (Rs.11.50 billion) in Net Sales and approximately US$30 million (Rs.2.25 billion) in Adjusted EBITDA. The sale is not expected to have a material impact on Kraft Heinz’s annual financial results.

Under the terms of the agreement, Kraft Heinz will sell to Zydus Wellness Limited (jointly with Cadila Healthcare Limited), 100% of its equity shares in Heinz India Private Limited, which is comprised of Complan, Glucon-D, Nycil and Sampriti brands, and two manufacturing facilities, with approximately 900 employees associated with these brands and operations.

J.P. Morgan Securities LLC served as exclusive financial advisor to Kraft Heinz for this transaction, while India-based Cyril Amarchand Mangaldas and global law firm Gibson, Dunn & Crutcher served as legal advisors for Kraft Heinz.

The Kraft Heinz Company (NASDAQ: KHC) is the fifth-largest food and beverage company in the world.

Zydus Wellness Ltd (ZWL) is the listed entity of the Zydus group and is one of the leading companies in the fast-growing Indian consumer health market.

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