Reliance Consumer buys major stake in nutrition brand Udhaiyams Agro Foods

Reliance Consumer buys major stake in nutrition brand Udhaiyams Agro Foods

Reliance Consumer Products Limited (RCPL), the FMCG arm of Reliance Industries,  has acquired a majority stake in Tamil Nadu-based Udhaiyams Agro Foods, the company said in a statement on December 18.  Under the joint venture agreement, RCPL holds a majority stake, while Udhaiyams’ erstwhile owners hold a minority stake in the company.

As part of the transaction, RCPL infused Rs 380 crore into the company through a preferential allotment of 1.52 lakh equity shares at a price of Rs 25,000 per share, according to regulatory filings from November 24. Each equity share was issued at Rs. 25,000 including face value of Rs.10.00 per equity share and premium of Rs. 24,990 per equity share. RCPL will be holding 76 per cent stake, according to the MCA filing uploaded by Udhaiyams.

Udhaiyams Agro Foods Private Ltd, best known for its flagship brand ‘Udhaiyam’, has been operating for over three decades and has a strong presence in Tamil Nadu. The company sells staples and packaged food products such as rice, spices, snacks and idli batter, and has built a wide distribution network across the state.

"We are very excited to announce this joint venture, as it further strengthens RCPL’s presence in the branded staples space. This initiative also reaffirms our commitment to offering global-quality products to consumers at affordable price points, while promoting India’s legacy.," said T. Krishnakumar, Director, Reliance Consumer Products Limited.

"This partnership with RCPL opens up new opportunities for Udhaiyam," said  S. Sudhakar, Managing Director, Udhaiyams Agro Foods Private Limited.

Following this acquisition, the erstwhile promoters of Udhaiyams Agro Foods Private Ltd—S. Sudhakar and S. Dinakar—will continue to hold a minority stake in the company, RCPL said.