News & Media
Hershey to take full control of JV with Godrej
September 14, 2012
After months of speculation, American chocolate maker Hershey will acquire the balance 49 per cent stake held largely by Godrej Industries (43 per cent) and a minority shareholder ( six per cent) in the joint venture company Godrej Hershey Ltd. The deal, roughly Rs 200 crore in size, will be completed by the end of the second quarter this year, after which the wholly-owned subsidiary will be called Hershey India. The enterprise value of the JV has been pegged at around Rs 400-600 crore, persons familiar with the development said.
Hershey would assume about Rs 260 crore of debt as part of the deal and also own the Maha Lacto and Nutrine confectionary brands, as well as the Jumpin and Sofit beverage brands, which were part of the JV. The only product from the Hershey stable, which was included in the JV, was Hershey’s Syrup.
The sales of Godrej Hershey’s for the year ended March 31 was Rs 386 crore. But it continued to make losses even after five years of being in existence, which was partly one of the reasons why, say persons familiar with the matter, for the two partners to drift apart. For the year ended March, it had losses of Rs 74 crore.