US-based food manufacturer Kellogg Company is reportedly in talks with Haldiram’s to acquire a stake in the Indian snack food manufacturer.
The Economic Times reported that the firms are in talks under an exclusivity agreement, which will lapse by the end of this month.
If the deal materialises, Haldiram’s will be valued at around $3bn.
A transaction with Haldiram’s will be complex given that the business is spread over three major locations, which are Delhi-based Haldiram Snacks, Nagpur-headquartered Haldiram Foods International and Kolkata-based Haldiram Bhujiawala.
These three hubs are operated by different members of the Agarwal family following a split in the 1990s.
It si reported that the deal began three to four months ago and Deutsche Bank is advising the Indian manufacturer on the transaction. With Haldiram’s looking to enter the breakfast segment, the deal with Kellogg Company could help them move in a new direction.
Delhi-based Haldiram Snacks is also currently in preparing to launch instant mixes.
An official told TOI: “There could be a joint venture or alliance between the two.”
One part of the family is reportedly keen on the deal, the others are not.
A food industry executive told the publication: “It doesn’t make sense if Kellogg’s does not get the entire pie.”
Earlier too, Haldiram’s was approached by several private investment firms but did not yield into a transaction.
Kellogg’s is looking to widen its portfolio through local deals due to sluggish growth in its core cereal business. In 2017, it bought Nigerian food distributor Multipro and RXBAR.
