Agri-business company Godrej Agrovet Ltd, a subsidiary of Godrej Industries Ltd, has acquired additional 25 per cent equity stake in Hyderabad-based Creamline Dairy for an undisclosed amount, as per a stock market disclosure.
With this stake acquisition, Godrej Agrovet will now own a controlling stake of 51 per cent in Creamline. Godrej Agrovet has picked 26 per cent stake in the Hyderabad-based company in 2005.
" We believe Godrej Agrovet will be able to bring in significant value to the business (of Creamline ) by helping it develop brands and add more value added products to its current portfolio," said Balram Singh Yadav, managing director of Godrej Agrovet.
At present, Godrej Agrovet has about 20 per cent market share in the organised cattle feed market.
The company did not share for how much the stake has been acquired. However, according to a report by The Economic Times, Godrej Agrovet picked the stake for around Rs 150 crore, valuing the company at around Rs 550 crore.
An email sent to Godrej Agrovet's spokesperson seeking further information on the deal did not elicit any response by the time of filing this article.
Creamline is strengthening its procurement operations in Telangana, Andhra Pradesh, Tamil Nadu, Karnataka and Maharashtra and has chalked out plans to set up three processing facilities to increase its geographical footprint and fuel growth.
"Godrej Agrovet will add value to our business through its association with Indian dairy farmers and knowledge on building brands," said K Bhaskar Reddy, managing director of Creamline.
The company has operations across states such as Andhra Pradesh, Tamil Nadu, Karnataka as well as parts of Maharashtra. It has 29 milk chilling centres of its own and nine belonging to associates. Its products are sold under the 'Jersey' brand.
With a capacity to process nearly seven lakh litres of milk a day, Creamline clocked revenues of Rs 858 crore for the year-ended March 2015.
Creamline expects to close financial year 2015-16 with around Rs 1,000 crore in sales. It also aims to double turnover in three-four years.
Godrej Agrovet has operations in areas like animal feed (where it is the largest manufacturer of compound feed in India, producing more than 1.1 million tonnes of feed and nutrition products for dairy cattle, poultry and aquaculture annually), oil palm plantations, hybrid seeds and processed poultry, where it runs a JV firm Godrej Tyson Foods.
Recently, it raised its holding in agrochemicals maker Astec LifeSciences Ltd by picking up additional 6.99 per cent equity stake in an open offer for around Rs 33.54 crore (approximately $5 million).
