ITC Ltd is in advanced discussions to acquire MTR Foods Pvt. Ltd and Eastern Condiments Pvt. Ltd, the Indian subsidiaries of Norwegian conglomerate Orkla ASA, in a deal valued at approximately $1.4 billion. The acquisition would significantly enhance ITC's presence in the fast-growing packaged food and spice segments, particularly in southern India, where both brands have a strong foothold. Sources indicate that this move aligns with ITC's strategy to expand its FMCG portfolio and strengthen its market share in the food business.
Orkla examined an initial public offering (IPO) for its Indian businesses at first. The Norwegian business has redirected its attention toward conducting a private stake sale for its majority position in Indian operations. The company will drop its IPO plans if a private acquisition agreement provides a desirable evaluation. A private stake purchase remains the preferred choice over an IPO although the option has not been fully eliminated.
MTR Foods started operations in 1950 through the Maiya family of Bengaluru and evolved to achieve status as one of India's leading packaged food brands. The Indian spice market has Eastern Condiments as a major player since its market entry in 1983. The combined operations of MTR Foods and Eastern Condiments represent 80% of Orkla India's total revenue at Rs 2,400 crore in FY24. These acquired brands would enhance ITC's position as a leader in the prepared food and spice markets.
The acquisition by ITC of MTR Foods and Eastern Condiments would improve its range of fast-moving consumer goods (FMCG). ITC continues to develop its product reach by acquiring the premium frozen food brand Prasuma in its recent business deal. An acquisition between ITC MTR Foods and Eastern Condiments would help ITC establish a solid position in the thriving food market while permitting it to introduce new products. The purchase gives ITC a stronger market position for both Indian and international regions such as North America, West Asia, and Southeast Asia.