Dabur India Ltd. agreed to acquire packaged spices maker Badshah Masala Pvt. as the consumer goods company looks to bolster its food business to take on rivals like Hindustan Unilever Ltd. and ITC Ltd.
The maker of chyawanprash to toothpaste has signed definitive transaction agreements to acquire 51% shareholding of the Mumbai-based Badshah Masala for Rs 587.52 crore, Dabur said in an exchange filing. The deal to buy the majority stake in Badshah Masala, engaged in the business of manufacturing, marketing and export of ground spices, blended spices and seasoning, is expected to be completed this fiscal.
Dabur will buy the remaining 49% after five years.
The acquisition marks Dabur’s entry into the more than Rs 25,000-crore branded spices and seasoning market in India, currently dominated by regional and local players. It is also in line with Dabur’s intent to expand its foods business to Rs 500 crore in three years while expanding into new adjacent categories.
“The Indian spices and seasoning category is a large and attractive market,” Mohit Burman, chairman at Dabur, said in the statement. “Badshah Masala is one of the key players in this space… We intend to leverage our international market presence to grow this business globally.”
Badshah, founded by Jawaharlal Jhaveri and Indiraben Jhaveri in 1958, reported a a turnover of Rs 189 crore in the year ended March 31. Blended spices contribute the majority of its revenue.
It has two manufacturing facilities located in Umargam, Gujarat and supplies 52 products in India and overseas.