INDIA: Hindustan Lever's take-over of Modern Foods remains newsy
The jury is still out on whether the privatization of government-owned Modern Foods was the right move, but the signs are good. The company was sold to Hindustan Lever (an affiliate of Anglo-Dutch Lever Bros ) for US$22.7m, the first divestment from a series of "non strategic" shareholdings owned by the Indian Government. Gaining control of Modern Foods suited Hindustan Lever beautifully, guaranteeing a market share in many staple foods; including flour, salt and more recently bread. The latter does not fit well into Indian lifestyle: most Indians make their own bread from (mainly wheat) flour ground at home or in the neighbourhood mill. But Hindustan Lever has a track record of changing Indian food habits to its advantage. Decades ago it convinced an entire generation to abandon milk-derived fats in favour of hydrogenated vegetable oil, and the bread brand is already doing well. Sales in Jaipur are doubling and at the company's 13 bread units more than seven currently work at full capacity, while the Delhi factory, renowned for labour indiscipline, works to one-fourth capacity. Increasing productivity encouraged the Union to raise concerns over the treatment of employees, but with the recent suspension of three officials, Govind Yadav, V K Narang and Ganesh Thakur, for manhandling another employee, it seems that treatment, as well as discipline, has also improved.
Get full access to all content, just $1 for 30 days
A Message From The Editor
just-food gives you the widest food market coverage.
Paid just-food members have unlimited access to all our exclusive content - including 17 years of archives.
It’s our best ever membership offer – just for you.
Dean Best, editor of just-food
- US food next wave on display at Winter Fancy Food
- How General Mills plans to grow - CAGNY
- Comment: Meal kits in US - don't believe the hype
- CAGNY analysis: Danone's growth strategy
- Wessanen eyes growth in "resurgent" organic market
- Unilever launches operational review
- Glanbia focuses on nutrition with Irish dairy spin
- Kerry's Scanlon to replace McCarthy as CEO
- Mondelez launches savoury snacks brand Vea
- Bonduelle to buy US produce group Ready Pac Foods