Orkla, a Norwegian supplier of branded consumer goods to the grocery, out-of home, specialised retail, pharmacy and bakery sectors, has entered into an agreement to acquire 67.8% stake in Kochi-based Eastern Condiments.The parties had agreed on a purchase price that values Eastern Condiments at ₹2,000 crore, on a debt and cash-free basis.On Friday, Orkla, through its wholly owned subsidiary MTR Foods, signed agreements to buy a 41.8% stake in Eastern from members of the Meeran family, and to acquire the entire ownership stake held by McCormick Ingredients SE Asia PTE. Ltd, which will give Orkla 67.8% ownership stake after completion of the transactions. The Meeran family currently owns 74% of Eastern, while McCormick holds a 26% stake.Following the completion of these transactions, a merger application would be filed to merge Eastern into MTR Foods. The merged company would be jointly owned by Orkla and the two Meeran brothers Firoz and Navas, with an ownership stake of 90.01% and 9.99%, respectively. “Together with MTR, and as part of Orkla, we will have a stronger platform for our successful operations,” said Navas Meeran, Chairman of Eastern.“This announcement marks a significant step for Orkla towards delivering on its strategy to strengthen our footprint in our core geographies. By joining forces, Eastern and MTR will create a solid platform in the fast-growing Indian market, based on strong local brands. MTR has been a great success story for Orkla. Now, we look forward to continuing the journey with the Meeran brothers as partners,’’ said Orkla president & CEO Jaan Ivar Semlitsch.Orkla entered the Indian branded food market in 2007 with the acquisition of MTR Foods and since then, its sales grew fivefold. For the last 12 months ending 30 June, 2020, MTR had a turnover of ₹920 crore. With Eastern coming into its fold, Orkla is now poised to strengthen position in the country’s branded food market and double its sales.Eastern Condiments was set up by M.E Meeran in 1989 in Kerala’s Adimali, to manufacture spices, masalas, blended spice powders, pickles and rice-based products.
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