The Kraft Heinz Company announced on Wednesday (24) that it has entered into a deal to sell Indian brands Complan, Glucon-D, Nycil, and Sampriti to Zydus Cadila for Rs 46 billion (£483.62 million) on a debt free and cash free basis.
The transaction is expected to close in early 2019, subject to regulatory approvals of the competition commission of India and other customary closing conditions, Kraft Heinz Company said in a statement.
“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 at 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,” he added.
At current FX rates, this business generates approximately £116.07m (Rs 11.50bn) in net sales and approximately £23.21m (Rs 2.25bn) in adjusted earnings before interest, tax, depreciation and amortization (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 per cent 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.
JP Morgan Securities LLC served as an 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.