ITC to acquire Prasuma and Meatigo to strengthen frozen food portfolio

New Delhi: Conglomerate ITC announced the acquisition of ‘Prasuma’ and ‘Meatigo’ brands, expanding its presence in frozen, chilled, and ready-to-cook foods.

ITC has signed definitive agreements for the acquisition of Prasuma1, a player in the frozen, chilled and ready-to-cook foods space in India. It operates through the ‘Prasuma’, ‘Meatigo by Prasuma', and ‘Prasuma Momo Kitchen’ brands.

It will acquire a 100% stake in Prasuma over three years, said a joint statement.

Prasuma is a specialist in oriental cuisines, such as momos, baos, Korean fried chicken, high-quality delicatessens and raw meats, etc., and sells a wide assortment of 170+ products, backed by unparalleled innovation expertise in developing ‘Good-for-You’ products.

"This acquisition will further fortify ITC’s presence in these future-facing categories, with a current annual market size of over Rs 10,000 crore and poised for rapid growth in the years ahead," it said.

ITC has been operating in the frozen foods market under the ‘ITC Master Chef’ brand since 2019.

"With the proposed acquisition, ITC will become the first full-stack player in the segment with an unparalleled portfolio, offering meals and snacking options across multiple occasions throughout the day for the discerning consumer," it said.

ITC Master Chef and Prasuma shall also benefit from significant synergies through well-designed institutional mechanisms and enablers, the statement added.

“We are delighted to back Prasuma and look forward to jointly building an unparalleled, full-stack frozen, chilled and ready-to-cook foods portfolio. With Good-for-You, first-to-market products, across cuisines, we believe that the combined portfolio will delight our discerning consumers. This investment reaffirms our commitment to building future-facing, best-in-class, innovative portfolios,” said ITC Wholetime Director Hemant Malik.

It has "executed definitive agreements for acquisition of 100% of the share capital of Ample Foods along with Chao Chao Foods Private Limited, a wholly owned subsidiary of AFPL and Meat and Spice Pvt Ltd," said ITC in a regulatory filing.

AFPL and MSPL are engaged in the business of manufacturing and selling ready-to-cook snacks & meals, sauces & condiments, raw & deli meat, local & international marinades, cheese and frozen foods & snacks under the brand names ‘Prasuma’ and ‘Meatigo’.

MSPL owns about 43 per cent equity stake in AFPL.

This is "in line with the strategy to augment the company’s future-ready portfolio; the transaction will fortify ITC’s presence and market standing in the high growth segments of the frozen, chilled and ready-to-cook foods industry in India, which is currently estimated at over Rs 10,000 crore and is poised for rapid growth in the years ahead," said ITC.

In FY 2023-24, the consolidated business of AFPL, MSPL and CCFPL had a turnover of Rs 131 crore.

ITC will acquire a 62.5% equity stake in AFPL through primary subscription and purchases of Rs 187 crore.

"Initial investment of Rs 131 crores to be made through primary subscription and secondary purchases for the acquisition of 43.8% equity stake, which is expected to be completed by 31st March 2025 or such later date as may be mutually agreed upon," it said.

While secondary purchases of Rs 56 crore will be made based on pre-agreed pre-money valuation, taking ITC’s equity stake to 62.5%, which is expected to be completed by April 2027.

"Purchase of balance equity stake in AFPL and 100% stake in MSPL to be made by 30th June 2028 or such later date as may be mutually agreed upon, basis valuation to be determined based on pre-agreed criteria," it said.